Professional Documents
Culture Documents
MR. A.S.M. MAIN UDDIN MONEM MR. MD. ABDUL AWAL MR. AMJADUL FERDOUS CHOWDHURY
VICE CHAIRMAN DIRECTOR DIRECTOR
MR. S.M. ABU MOHSIN MR. ABDUS SALAM MRS. SOHELA HOSSAIN
DIRECTOR DIRECTOR DIRECTOR
MR. KHAIRUL ALAM CHAKLADER MR. MD. MOINUDDIN MR. K.A.M. HAROON
DIRECTOR DIRECTOR INDEPENDENT DIRECTOR
MR. MD. AMIRUL ISLAM, FCS, FCA MR. GOLAM HAFIZ AHMED
INDEPENDENT DIRECTOR MANAGING DIRECTOR & CEO
AUDITORS : ACNABIN
Charterd Accountants
BDBL Bhaban (Level-13 &14)
12, Kawran Bazar, Commercial Area
Dhaka-1215, Bangladesh.
MR. MD. ABUL BASHAR MR. MD. AMIRUL ISLAM, FCS, FCA
Independent Director
MEMBER MEMBER
MANCOM
MR. MOHAMMED MIZANUR RAHMAN, FCA MR. MOHAMMAD WAHEDUR RAHMAN MR. MD. FAZLUR RAHMAN MR. ABU ZAFORE MD. SALEH
EXECUTIVE VICE PRESIDENT & CFO SR. EXECUTIVE VICE PRESIDENT SR. EXECUTIVE VICE PRESIDENT SR. EXECUTIVE VICE PRESIDENT
(from left to right)
MEMBER MEMBER MEMBER MEMBER
MANCOM
MR. GOLAM HAFIZ AHMED MR. AKHTAR HAMID KHAN MR. TAPAN KANTI SARKAR MR. ASHIM KUMAR SAHA MR. A.R.M. SAOKOT HOSSAIN (from right to left)
MANAGING DIRECTOR & CEO DEPUTY MANAGING DIRECTOR EXECUTIVE VICE PRESIDENT EXECUTIVE VICE PRESIDENT SR. VICE PRESIDENT
CHAIRMAN MEMBER MEMBER MEMBER SECRETARY
bvkbvj wWU G Kgvm evsK wjwgUW-Gi 29Zg evwlK mvaviY mfvq DcwZ mvwbZ kqvinvviMY
It is my great pleasure to be able to welcome you all to the 30th Annual General Meeting of the Bank
in this pleasant summer morning. I am immensely grateful to Almighty Allah to grace me with the
opportunity to be present with you on this auspicious occasion.
In 2014, we have primarily focused on various compliance issues to put the Bank in further strong
foothold on the ground to look forward boldly to the future to harvest good fortune. This may have
put us in somewhat behind in terms of immediate result but in the long run, we hope, that we will
be rewarded immensely by deriving business on a more secured base.
As part of our on going reform programme in some key operational aspects of the business, we
have already streamlined Banks credit and International Trade and brought discipline in credit
administration by ensuring proper documentation including pre and post disbursement
supervision. In order to support and strengthen this, technical assistance has been ensured
through Banks Information Technology Division manned by a highly experienced and skilled Team,
supplementing our effort by designing new programs regularly. All these changes though initially
put some pressure and hindrance in our outcome as it was required to educate the valued clients
about their benefits, but after a couple of years of operation, its true results are in the offing. We
sincerely believe that in near future the Bank would reach a commendable stage to satisfy our
Stakeholders.
In 2014, we also focused in strengthening Banks Internal Control and other supervisory units to
clear up all lapses and errors that occurred in course of day to day business over the long years of
operations so as to safe-guard your interest and make it certain that the peoples money is safe and
not diverted away by the unscrupulous elements. Now we can confidently note that the branch
operations are very transparent, prompt and in accordance with the regulations in force.
In 2014 two events that took place boosted up the morale and spirit of all Stakeholders including
the valued Shareholders and the working force as well. It is a very pleasant thing that after long
waiting, the construction of Banks own 22 storied building at the heart of countrys business
centre in Motijheel C/A has been completed. The entire Head Office apparatus was shifted to this
nicely built structure having all state of the art facilities to allow the people to work in an
atmosphere that will give them conducive environment to discharge their duties with a dedicated
mind. This building has already been termed as one of the beautiful structures by the admirers and
became a tool for our marketing strategy. This will surely enhance our image among the people
showing our strength and stability. In the last leg of the year the building was formally inaugurated
through a colorful programme where eminent personalities were present and expressed their good
gesture for success of our endeavors.
During the year, our efforts towards discharging CSR activities were also received due importance.
In addition to usual routine ones, the Bank awarded stipend to 274 meritorious destitute students
from various parts of the country who passed SSC and HSC examinations securing GPA 5.00. It
was a continuation of our steps of previous years in this regard that received remarkable response
and appreciation. Further, donations were made to the Honble Prime Ministers Relief Fund, Lakho
Konthe Sonar Bangla Fund,Ahsania Mission Cancer Hospital and other Diabetic Hospitals in the
remote areas of the country. We hope to continue this noble effort unhindered in future also.
You would surely appreciate that though our all acts are directed towards paying good dividends
to you, but the compliance efforts, as I have mentioned, put some obstacles and compelled us to
keep this at a conservative size. But situation is changing and we hope that in near future, the size
of dividend would reach the expectations of the Stakeholders.
We always try to ensure welfare of the work force who are the life of this Bank, Motivational and
skill development steps like training both in house and outside Bank including abroad are being
taken to groom the Banks workforce to make themselves equipped with upto date industry level
knowledge to face the changing scenario, customers choice and need.
I would like to take this opportunity to record my sincere thanks and gratitude to the Govt. of the
Peoples Republic of Bangladesh, Bangladesh Bank, Bangladesh Securities and Exchange
Commission, Dhaka and Chittagong Stock Exchange Limited, Registrar of Joint Stock Companies
and Firms and other regulatory bodies for their continued and prudent guidance and support to our
journey ahead. I would also like to place my thanks to all valued Shareholders, Clients, Well wishers
and Patrons for being with us supporting our efforts all the time. I also thank the Management
Team and dedicated employees of all strata for their sincere contribution to the growth of the
organization.
Khoda Hafez
Honble Chairman of the Board of Directors, Honble Vice Chairman, the Members of the Board present,
valued Shareholders, Senior level executives of the Bank, Media dignitaries, Assalamu Alaikum.
It is my immense pleasure to welcome you all to the Annual General Meeting of the Bank.
The Bank has completed another year of its journey towards excellence in 2014 completing nearly long
30 years of existence in the banking arena since its inception in 1985. We deeply express our gratitude
to Almighty ALLAH for making us fortunate enough to be together again on this occasion of AGM.
Bangladesh Banking sector has bright potential to flourish as we have a growing middle class eager to
upgrade their standard of living in one hand and a huge number of people living in remote areas, not
yet being privileged with banking facilities on the other. Bringing them under formal banking system
may create enormous opportunities of diversified business for us. The Central Bank has already
initiated various projects like opening of accounts of Tk.10/-, Tk.50/- and Tk.100/- for un-banked
segment of the population not getting the opportunities of banking. Another strategic sector that is
emerging and getting active support from the Central Bank is Green financing that would help in
preserving the nature and environment for greater sustainabilities. We are preparing ourselves to take
advantages of these steps in order to augment our whole operations to implement the inclusive
approach being pursued by Bangladesh Bank.
Dear Patrons,
You are aware that during the year, the political situation showed sort of abnormal calmness period and
a sense of acute uncertainty was felt round the year. This uncertainty played a significant role in
creating a stagnancy in investment both local & foreign, burdening the Banks with huge liquidity. The
Banks suffered both want of potential/feasible business compelling them to off load deposits and
reducing rate of interest, resulting Credit Deposit Ratio (CDR) to fall and remaining at lower than usual
level. With the prevalence of offshore finance and UPAS LCS, diminishing trend in credit growth with
falling lending rates bogged down the income of the Banks to a large extent. However, our utmost effort
was to keep the level of income at a satisfactory level by pursuing appropriate strategies .
All the branches of the Bank have been closely monitored and motivated to acquire fresh and good
business. Besides, due importance was given to realize all stuck up loans and advances by constituting
special team with special mission both at Head Office and Branch level. In applicable cases, legal
actions have been initiated and one to one negotiation also being continued.
It may be mentioned here that in 2014, our emphasis was mostly focused on compliance to rectify and
clean all lapses in allowing / sanctioning credit faculties so as to make the portfolio of the Bank healthy.
It is hoped that with this, the Bank would be greatly benefited in terms of both legal and procedural
aspects. You will be happy to learn that during the previous years of operation, it was possible to reduce
huge audit objections in line with the prudent guidelines of the Audit Committee of the Board. We can
now confidently assert that the credit portfolio of the Bank is more secured than ever. We do believe in
near future, its positive results will surface.
In the last stage of 2014, two remarkable happy events took place. On 29th December,2014 our 22
storied own building NCC Bank Bhaban at the hub in of the countrys business centre Motijheel
Commercial Area was inaugurated. This aesthetic structure with its unique architectural design has
already caught attention of the people in general. Coinciding with this, we have also unveiled our new
logo through a colorful programme at the Banks own Head Office Bhaban where many eminent
personalities were present. It is expected to make these two developments as tools of invigorated next
level marketing drive and further image building in the eyes of mass people. If this can be done
properly, the status and market position of the Bank would greatly improve in a very short span of time.
Our emphasis on the CSR activities have also been continued as in the previous years. A major event
in this regard was giving away stipend to 274 meritorious students succeeded in SSC and HSC
examinations securing G.P.A of 5.00 coming from financially constraints families. In this connection, a
programme was held at a local auditorium where the Honble Governor of Bangladesh Bank attended
as Chief Guest. We hope to continue similar initiatives in future as part of our contribution in the
countrys human capital which will ultimately add value to the process of Nation building.
Taking this opportunity I would like to greatly place my thanks to Govt. of Peoples Republic of
Bangladesh, Bangladesh Bank, Bangladesh Securities and Exchange Commission, Registrar of Joint
Stock Companies and Firms, Dhaka and Chittagong Stock Exchanges, National Board of Revenue and
other Regulatory Bodies for their continued guidance, cooperation and support to enable us to perform
our activities within the set frame work.
I would also like to record my gratitude to the prudent Board of Directors of the Bank for guiding us to
the right path with their wise policy and other strategic decision. My sincere thanks also go to my
colleagues in the Management Team and employees of all grades for their active and dedicated services
towards continued growth of the organization. Before I end, I must thank and express my heartfelt
gratitude to our every valued customers for their continued support and trust on our beloved Bank.
ALLAH Hafeez
The Value added statement for the bank shows how the value is created and distributed among different stakeholders
of the bank.
2014 2013
Particulars Taka % Taka %
Income from Banking Services 15,871,727,480 16,227,893,906
Less: Cost of Services & Supplies 10,229,720,174 10,944,460,505
Value Added by the Banking Services 5,642,007,306 5,283,433,401
Less: Provisions 1,221,323,403 1,351,935,762
4,420,683,903 3,931,497,639
Economic Value Added (EVA) indicate the true economic profit of a company. EVA is an estimate of the amount by
which earnings exceed of fall short of required minimum return for shareholders at comparable risks. EVA of the bank
stood at Tk. -280.13 Million as on December 31, 2014 as against Tk. -500.82 million in 2013.
2014 2013
Particulars Taka Taka
Total Revenue 15,871,727,480 16,227,893,906
Less: Expenses 13,371,249,020 13,901,015,693
Profit Before Tax (PBT) 2,500,478,460 2,326,878,213
Less: Corporate Tax 999,149,242 1,189,031,038
Profit After Tax (PAT) 1,501,329,218 1,137,847,175
* Based on weighted average rate of Sanchya Patra issued by the Bangladesh Government plus 2% risk premium.
Market Value Addition (MVA) is the difference between the equity market value of a company and the book value of
equity invested in the company. A high MVA indicates that the company has created substantial wealth for the
Shareholders.
2014 2013
Particulars Taka Taka
Market Value of Total Equity 8,992,765,130 10,017,450,960
Less: Book Value of Total Equity 14,349,689,532 13,269,835,814
Market Value Added (5,356,924,402) (3,252,384,854)
Qualitative (a) Summary information on the The terms and conditions of the main features of all capital
disclosures terms and conditions of the instruments have been segregated in terms of the eligibility
main features of all capital criteria set forth vide BRPD Circular No.35 dated 29 December
instruments, especially in 2010 and other relevant instructions given by Bangladesh Bank
the case of capital from time to time. The main features of the capital instruments
instruments eligible for are as follows:
inclusion in Tier 1 or Tier 2. Tire 1 capital instruments
i) Paid-up share capital: Issued, subscribed and fully paid up
share capital of the bank. It represents paid-up capital, right
shares as well as bonus shares issued from time to time.
iv) General reserve: Any reserve created from profit and loss
account for fulfilling future purposes.
Qualitative (a) A summary discussion of the The Bank has adopted standardized approach for computation of
disclosures bank's approach to capital charge for credit risk and market risk and Basic Indicator
assessing the adequacy of Approach (BIA) for operational risk.
its capital to support current
and future activities. The Bank has maintained capital adequacy ratio on the basis of
"Consolidated" and "Solo" are 13.28% and 13.47% respectively
as against the total regulatory requirement of 10%. Tier-I capital
adequacy ratio for " Consolidated" and "Solo" was 12.13% and
12.31% against the minimum regulatory requirement of 5% .
The Bank's policy is to manage and maintain its capital with the
objective of maintaining strong capital ratio and high rating. The
Bank maintains capital levels that are sufficient to absorb all
materials risk. The Bank also ensure that the capital levels
comply with regulatory requirements and satisfy the external
rating agencies and other stakeholders including depositors. The
whole objective of the capital management process in the Bank
is to ensure that the Bank remains adequately capitalized at all
times.
Qualitative (a) The general qualitative disclosure requirement with respect to credit risk, including:
Disclosures
i) Definition of past due and The Bank follows Bangladesh Bank circulars and guidelines
impaired (for accounting relating to classification and provisioning to define past due
purposes) impairment. Following table summarized the objective criteria
for loan classification and provisioning as stipulated by the
Central Bank vide BRPD circular no. 14 dated 23 September
2012, (Amendment BRPD Circular no. 16, dated November
18,2014:
Loan classification
Types of SMA Sub-standard Doubtful Bad & Loss
facility
Over due Provision Over due Provision Over due Provision Over due Provision
Period (%) Period (%) Period (%) Period (%)
Continuous 60 days or 5% 3 Months or 20% 6 Months or 50% 9 months 100%
Loan more more but less more but less or more
than 6 months than 9 months
Demand 60 days or 5% 3 Months or 20% 6 Months or 50% 9 months 100%
Loan more more but less more but less or more
than 6 months than 9 months
Fixed term 60 days or 5% 3 Months or 20% 6 Months or 50% 9 months 100%
loan more more more but less more but less or more
han Tk.1.00 than 6 months than 9 months
million
Fixed term 60 days or 5% 6 Months or 20% 9 Months or 50% 12 months 100%
loan up to more more but less more but less or more
Tk.1.00 than 9 months than 12 months
million
Short-term 90 days or 2.50% 12 Months or 5% 36 Months or 5% 60 months 100%
Agricultural more more but less more but less or more
and Micro than 36 months than 60 months
Credit
ii) Description of approaches Bank maintains specific provision for classified loans and
followed for specific and advances and general provision on unclassified loans and
general allowances and advances are measured following Bangladesh Bank prescribed
statistical methods: provisioning rates are mentioned below:
General provision: Rate
Qualitative (a) The general Differentiation between holdings on which capital gains are expected and
disclosures qualitative disclosure those taken under other objectives including for relationship and strategic reasons
requirement with ; and investment in equity securities are broadly categorized into two parts:
respect to the equity i) Quoted securities that are traded in the secondary market.
risk:
ii) Unquoted securities are categorized as banking book equity exposures
which are further sub-divided into two groups: unquoted securities which are
invested without any expectation that these will be quoted in near future i.e.
held to maturity (HTM), and securities those are acquired under private
placement or IPO and are going to be traded in the secondary market after
completing required formalities. Unquoted securities are valued at cost.
Discussion of important policies covering the valuation and accounting of
equity holding in the banking book. This includes the accounting techniques
and valuation methodologies used, including key assumptions and practices
affecting valuation as well as significant changes in these practices.
The primary aim is to investment in these equity securities for the purpose of
capital gain by selling them in future or held for dividend income. Dividends
received from these equity securities are accounted for when bank's right to
get the dividend is established. Both quoted and unquoted equity securities
are valued at cost or market value whichever is lower and necessary
provisions are maintained if the prices fall below the cost price.
Quantitative (a) Value disclosed in
disclosures the balance sheet of
investments, as well
as the fair value of Bank Position Consolidated Position
those investments ; At cost At market Value At cost At market Value
for quoted securities
,a comparison to Quoted shares 164.00 115.22 164.95 116.19
publicly quoted Unquoted shares 4.82 4.08 6.76 6.02
share values where
the share price is
materially different
from fair value .
Quantitative (c) The cumulative
disclosures realized gain ( Bank Position Consolidated Position
losses) arising from
sales and 3.91 3.92
liquidations in the
reporting period .
v) Approach for The Bank follows Basic Indicator Approach (BIA) for measuring capital charges for
calculating capital operational risk. Under the Basic Indicator Approach (BIA), the capital charge for
charge for operational risk is a fixed percentage (denoted by alpha) of average positive annual gross
operational risk income of the Bank over the past three years.
To make our branch as Green one What we are doing daily to become sustainable Green Finance Incorporation of ERM in CRM
I. Provision for maximum use I. Take advantage of natural light Bangladesh Bank, vide their Bangladesh Bank, vide their BRPD
of natural light, whenever possible. GBCSRD Circular no. 02, dt. Circular no. 02, dt. 27.02.2011,
II. Use of renewable energy (Solar), II. Turn off the lights every time 01.07.2013, GBCSRD Circular Letter titled Policy Guidelines for Green
III. Use of energy saving bulbs whenever we leave a room. No. 01, dt. 20.05.2014 and GBCSRD Banking, advised all the
and other equipments, III. Switch off our PC system whenever Circular Letter No. 02, dt. scheduled banks to incorporate
IV. Reduced use of water and we plan to be away from our desk 18.08.2014 had introduced 47 green Environmental risk Management
electricity, for an extended period of time. products under different sectors like (ERM) in the proposals of credit
V. Use of recycled water etc. IV) Ensure the printer has toner/ink Solar System, Renewable Energy, facilities above the threshold level.
VI. Using printers, photocopiers saving modes. Draft or Eco mode Bio-Gas, ETP, Vermi-compost, PET All the branches of NCC Bank Ltd.
etc. with both side printing options saves ink and reduce Carbon. & Solar Battery Recycling Plant, should assess all environmental
ability etc. V) Use e-mail, intra-mail etc. for Hydroelectricity, Fuel Efficient risk factors associated with the
VII. Efficient Lighting System. communication purpose to save Technology, Non Fire Block Brick existing projects/ future projects/
paper and time. Project, Environment Friendly Brick new projects.
VI) Adopt recycled materials in our branch. Kilns etc.
VII) Sharing the office stationeries in Branches used to assess EnvRR
the office. Later, Bangladesh Bank, GBCSRD for those industries complying
VIII) Using both sides of the papers for Circular No. 04, dt. 04.09.2014, Bangladesh Bank Guidelines.
printing, note taking and rough purpose. advised all the scheduled banks to
IX) Inspire people to act in an finance at least 5% of total funded
environment friendly manner. loan as Green Finance, i.e. our target
X) Follow the Banks Green Office of green financing is 5% of total
Guide that has already been advance and we advised branches
communicated to employees vide achieve the target of green finance of
intra-mail dt.10.12.2014 i.e. 5% of total advance of that branch.
Information related to environmental issues: iii. Some Green Features of NCC Bank Bhaban: The NCC
All the information regarding Green Banking or Sustainable Bank Bhaban bears several green features such as, scope of
Banking are available in the Head Office server (address: maximum use of daylights, solar panels, automatic stopping
\\192.168.254.1\IT Folder\Green_Banking_Soft Copy). All water faucets, low flush toilets, energy saving lights, both
the Circulars related to Green or Sustainable Banking are side printing printers and photocopiers, energy efficient &
available in the Banks central circular archive environment friendly equipments and many more.
(http://192.168.101.20/Circulars/). Moreover, for more
information, anyone can communicate with the Green iv. Solar equipped Branches: NCC Bank Ltd. has already
Banking Unit (GBU) through intra-mail (address: inaugurated 12 Branches in different areas of the country
gbu@nccbank.com.bd) or vide 02-9512620. that run Partially by solar power. These are Uttara, Tongi,
NCC Bank Ltd., as a socially responsible financial Narshingdi, Maijdee, Madambibirhat, Juri, Rayerbazar,
institution, has taken numerous initiatives to promote Faridgonj, Mahipal , Parulia, NCC Bank Bhaban branch and
Green Banking as under: Head Office. The Marketing and Branches Division (MBD)
and Common Services Division (CSD) of our bank have
i. Green Banking Policy: NCC Bank Ltd. has already already been advised to introduce green features in the
prepared Green Banking Policy in line with the Policy branches. Moreover, all the branches of the Bank have also
Guidelines for Green Banking issued by Bangladesh Bank been advised to look for the green features at their
and formed a separate Green Banking Unit with the branches.
responsibility of designing, evaluating and administering
green banking related issues of the Bank. v. Training: NCC Bank management believes that
awareness is the main media of success of Green activities.
ii. Green Office Guide: NCC Bank Ltd. has also prepared In 2014, NCC Bank Ltd. organized various
Green Office Guide for internal use as a set of general seminars/workshop/training sessions exclusively for
instructions for the employees of the Bank. This guide Green Banking awareness. The Executives & Officers have
encourages employees of the Bank to save paper, water, also participated in various seminars/workshop/training
electricity, gas etc., reuse of equipments, using online sessions held at Bangladesh Bank and other places
communication system, adopting efficient electronic throughout the time. During year 2014, 335 employees
equipments in order to save the environment. attended 20 different training/ seminar/ workshops on
green banking issues.
vi. Green Finance: NCC Bank Ltd. has been financing eco x. Online Banking: All of the branches of NCCBL are well
friendly business activities and energy efficient projects equipped with online facilities, BACH for clearing, BEFTN
like Bio-gas, ETP, Energy Efficient Brick Kilns and other mechanism for transferring the local currency as well as
renewable energy & environment friendly projects. NCC foreign remittance and salary disbursement etc. At present
Bank has provided Tk. 9060.90 million in 2013 & Tk. our ATM services are at door step of clients providing
8275.45 million in 2014 as green finance. 24/7/365 days non stop services.
Year
Ratings
2013 2012
Long Term AA (Very Strong Capacity) AA- (Very Strong Capacity)
Short Term AR-2 (Strong Capacity) AR-2 (Strong Capacity)
Outlook Stable Stable
Date of Rating June 30, 2014 June 30, 2013
Valid till June 29, 2015 June 29, 2014
Rating action Surveillance Initial
An institution rated AA in the long term have very strong capacity to meet its financial commitments and rated AR-2 in
the short term have strong capacity to meet its financial commitments in a timely manner. Stable Outlook indicates that the
Rating is likely to remain unchanged.
43.23%
Others 11.47%
Acceptances and endorsements 10.80%
Export development fund (EDF) 0.14
Agriculture 1.43%
Industry 38.82%
House building loan 3.50% Letter of Credit 6.75%
Transport and
communication 2.33%
135,160
21,706
125,842
124,043
18,703
103,511
16,323
16,079
83,554
12,505
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
55,044
52,614
51,308
16,126
45,283
14,549
14,354
41,245
13,347
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
105,704
30,852
98,229
96,918
90,921
88,167
26,569
81,127
79,948
72,734
20,840
67,961
19,908
63,230
10,981
Deposit
Advance
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
GRAPHICAL PRESENTATION
90,921
88,167
105,704
79,948
96,918
98,229
72,734
63,230
81,127
67,961
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
8,029
4,187
7,647
6,952
4,041
5,942
3,958
4,501
3,747
3,699
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
12,136
4,283
11,331
3,818
9,357
3,269
2,543
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
15,178
13,987
3.20
12,778
11,825
2.70
10,034
1.10
1.00
1.00
GRAPHICAL PRESENTATION
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
1,313
13,865
12,819
11,666
10,701
8,881
1,168
1,153
1,124
1,112
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
16
14
13.47
2.12
12 11.87
11.26 11.47
10.91
10
8
1.14
1.16
0.91
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
18.98
13.99
11.81
10.87
8.96
11.50
9.05
11.04
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
12.91
5.33
8.80
8.73
3.70
8.21
5.99
2.06
1.87
1.49
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
GRAPHICAL PRESENTATION
Market Value Per Share (2010-2014) Net Asset Value Per Share (2010-2014)
20.79
68.80
19.50
17.87
17.46
17.34
30.40
18.20
13.10
11.20
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
112,222
112,052
7.49
108,688
94,314
5.56
5.51
74,692
2.68
2.27
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
3,630
3,248
2,743
15,355
2,500
13,789
2,327
9,197
8,863
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
12,194
12,020
11,669
2,372
9,669
1,946
6,970
1,501
1,434
1,138
GRAPHICAL PRESENTATION
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
4,034
3,938
3,852
449
434
3,188
420
418
396
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
120
2500
100 101 103 2277
2192
93
87 2000
80 79 1811
1716
1622
60 1500
40
1000
20
500
0
2010 2011 2012 2013 2014
0
2010 2011 2012 2013 2014
Market Value Per Share (in BDT) & Operational Profit & Net Profit (2010-2014)
PE Ratio (in Times)(2010-2014) Figure (in Million)
68.80
4,187
4,041
3,958
3,699
3,747
Market Price
2,372
PE Ratio
30.40
1,946
1,501
1,434
18.20
1,138
12.91
13.10
11.20
8.21
Operational Profit
8.73
8.80
5.99
Net Profit
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
Growth in emerging markets and developing countries In order to protect Bangladeshs external competitiveness,
was projected to be modest in 2015 supported mainly by Bangladesh Bank continued its intervention
stronger domestic demand. Growth in these countries was in the domestic foreign exchange market by purchasing
projected to decline to 4.4% in 2014 from 4.7% in 2013. foreign currencies as and when deemed appropriate. As a
and then, increase to 5.0% in 2015. Growth in China was result, Taka: USD exchange rate remained stable during
projected at 7.4% in 2014 due to some targeted policy FY14.
measures to support advanced economics, protracted low
Capital and Statutory Reserve Foreign Exchange business is one of the important means
of income of the Bank contributing remarkably to its profit.
The Authorized Capital of the Bank stood at Tk.10,000 It has been our priority to see that such operations get due
million as on 31.12.2014 and Paid up Capital was care round the year. By putting right people at the right
Tk.8,029.25 million on 31.12.2014. Statutory Reserve was place, this has been ensured. By providing adequate and
Tk.4,783.51 million as on same date. proper service, the Bank could earn good amount of
income from the sector. During the year 2014, the Bank
Deposits : handled Exports and Imports business to the tune of
Tk.14,354.29 million and Tk.51,308.43 million
At the end of the year under consideration, Deposits of the respectively. The number of Banks Authorized Dealer (AD)
Bank stood at Tk.105,703.61 million recording 7.61% branches were 22 in 2014.
increase over the figure of the proceeding year which was
The Bank has a correspondent network of more than 396
Tk.98,229.41 million. Deposit mix is shown in the chart
offices of Foreign Banks World wide. For trade
appended below:
settlements, remittance business and OBU operations, the
Bank maintains 26 Nostro Accounts in all major
currencies of the World.
$271.38
Remittance Business
$250.10
$224.51
$216.02
The economic growth of the country largely depends on
$190.22
inflow of foreign exchange to keep import activities afloat.
Home bound remittance sent by the expatriate
Bangladeshis earned by their hard work is happened to be
one of the main ways of such inflow for quite few years. In
years back the Bangladeshis residing abroad were
compelled to remit their money to their nearest ones
through non banking channels like Hundi etc. In order to
bring this huge inflow of foreign remittance through
2010 2011 2012 2013 2014
banking channel, arrangements have been made by the
Banks with various money transfer enterprises abroad.
Card Business:
Foreign Remittance inflow to Bangladesh has shown Since introduction of Credit Card in 2005, NCCB Cards are
remarkable resilience, not only during but also after the becoming popular day by day because of using the most
global crisis. NCC Bank offers innovative products for advanced and comprehensive card management system.
NRBs and is playing significant role in strengthening It has been satisfying its valuable customers through this
national economy by channeling homebound remittances. great financial tool with utmost efficiency and customer
NCC Bank has become one of the pioneers in remittance satisfaction. NCCB Card has relationship with many
service in home and abroad through its innovative & prominent corporate houses and our customers can avail
dedicated services with modern technology, nationwide discount facilities from them. Now NCCB Card is considered
network ensuring customer satisfaction. The Bank has as the symbol of elegance, luxury and convenience.
representatives and correspondents in most of the Keeping utmost attention to create the benefits that
remittance sending countries and also has arrangements customer desire NCCB offers a wide range of card
with 31 Money Transfer Companies (MTO) having network products such as:
all over the World.
Multi Currency Cards:
NCC Bank is successfully maintaining relationship with Visa Dual Gold Credit Card
one NGO (TMSS), one Specialized Bank (AVUB) and other Visa Virtual Card (Pre-paid card)
seven sub-agent commercial banks to facilitate the foreign Local Currency Cards:
remittance service at remotest corner of the country with Visa Local Gold Credit Card
more than 1,400 locations. It has introduced centralized Visa Local Classic Credit Card
automated system RMS (Remittance Management Visa Local Gold Debit Card
System) to facilitate prompt, errorless and secure service Proprietary Debit Card
to the beneficiaries of foreign remittance. The automated
operation of Bangladesh Electronic Fund Transfer (BEFTN) Our Visa Credit cards are accepted in all Visa branded
has further enhanced the service level to new heights. We merchant outlets round the world. In addition, NCCB cards
are the first super-agent in Bangladesh of two worlds also provide instant cash withdrawal facility through
renowned MTOs namely MoneyGram International and branch POS, auto debit payment instruction, balance
International Money Express (IME) which evidenced our transfer facilities, reward program, instant SMS alert
efforts and contribution to this sector. We expect to service for all transaction & monthly statement, 24 x 7
appoint more commercial banks as sub-agent of the Bank support service, E-Statement Service and many more.
in 2015 for the foreign remittance payment of IME. Because of free accessibility and fast transaction approval
process, reputation of NCC Visa card is growing swiftly in
In the year 2014, we have extended our services in the card industry.
Australia by signing agreement with Fast Remit Exchange Furthermore, NCC Bank is going to launch most attractive
House. NCC Bank is the first and only Bank in Bangladesh new product Visa Platinum Card with EMV chip
to channelize foreign remittance from Japan in banking technology. All existing cards would to be converted to
channel through Japan Remit Finance. EMV chip card within this year.
We have examined the compliance of conditions of Corporate Governance Guidelines by National Credit
and Commerce Bank Limited and its Subsidiaries for the year ended 31 December 2014, as set by
Bangladesh Securities and Exchange Commission (BSEC) by the notification #
SEC/CMRRCD/2006-158/134/Admin/44 dated 7 August 2012 and subsequently amended through their
notification # SEC/CMRRCD/2006-158/147/Admin/48 dated 21 July 2013 issued under section 2CC of
the Securities and Exchange Ordinance, 1969.
The compliance of conditions of Corporate Governance Guidelines is the responsibility of the Banks
management. Our examination was limited to the procedures and implementation thereof, adopted by
the bank and its subsidiaries for ensuring the compliance of the conditions of Corporate Governance
Guidelines. It is neither an audit nor an expression of opinion on the financial statements of the bank
and its subsidiaries.
In our opinion and to the best of our information and according to the explanations given to us, we
certify that the bank and its subsidiaries have complied with the conditions of Corporate Governance
Guidelines as stipulated in the above-mentioned Notification.
We further state that such compliance is neither an assurance as to the future viability of the company
and its subsidiaries nor the efficiency or effectiveness with which the management has conducted the
affairs of the company and its subsidiaries.
Dated,Dhaka
21 May 2015 MABS & J Partners
Chartered Accountants
1.1 Boards size shall not be less than 5 and more than 20
1.2 Independent Director
1.2 (i) Independent director: At least 1/5th of the total number of directors
1.2 (ii) a) Independent director does not hold any share or holds less than one
percent (1%) shares of total paid up capital.
1.2 (ii) b) Independent Director is not a sponsor of the company and is not
connected with the companys Sponsor or Director or Shareholder
who holds 1% or more shares.
1.2 (ii) c) Independent director does not have any other relationship, whether
pecuniary or otherwise, with the company or its
subsidiary/associated companies.
1.2 (ii) d) Independent directors are not the members, directors or officers of
any stock exchange.
1.2 (ii) e) Independent director is not the shareholder, director or officers of any
member of Stock Exchange or an intermediary of the capital market.
1.2 (ii) f) Independent director is/was not the partners or executives during
preceding 3 (three) years of concerned companys statutory audit firm.
1.2 (ii) g) Independent directors is not the independent director in more than 3
(three) listed companies.
1.2 (ii) h) Independent director is not convicted by a court of competent
jurisdiction as a defaulter in payment of any loan to a bank or a
non-bank financial institution (NBFI).
1.2 (ii) i) Independent director has not been convicted for a criminal offence
involving moral turpitude.
1.2 (iii) The independent director shall be appointed by the Board of Directors
and approved by the Shareholders in the AGM.
1.2 (iv) The post of independent directors cannot remain vacant for more than
90 days.
1.2 (v) The Board shall lay down a Code of Conduct of all Board Members
and annual compliance of the Code to be recorded.
1.2 (vi) The tenure of office of an Independent Directors shall be for a period
of 3 (three) years which may be extended for 1 (one) term only.
1.5 (xx) The number of Board meetings held during the year and attendance
by each director shall be disclosed.
1.5 (xxi) The pattern of shareholding shall be reported to disclose the aggregate number
of shares (along with name wise details where stated below) held by:
1.5 (xxi) a) Parent/Subsidiary/Associated Companies and other related parties (name wise
details);
1.5 (xxi) b) Directors, Chief Executive Officer, Company Secretary, Chief Financial Officer,
Head of Internal Audit and their spouses and minor children (name wise details);
1.5 (xxi) c) Executives (top five salaried employees of the company other than stated in
1.5(xxi)b);
1.5 (xxi) d) Shareholders holding ten percent (10%) or more voting interest in the company No shareholder holds
(name wise details). more than 10% share
Statement of the Attendance of the Board of Directors during the year 2014
SL Name of the Hon'ble Directors Position Meetings held Attended No. of Absence Remarks
No.
As per Banking Companies Act-1991 (as amended in 2013) an Audit Committee of the Board of Directors shall be formed
to assist the Board of Directors of the Bank for smooth running the banking business. Accordingly, the Audit Committee of
the Board has been constituted as per guidelines of Bangladesh Bank and Bangladesh Securities and Exchange
Commission. Both the Regulators have emphasized on prudent & effective oversight by the Audit Committee of the Board
for un-earthing lapses & irregularities, if any, committed by the Bank Management at every tier and ensuring strict financial
discipline in the Bank, through recommendations to the Board. The major objectives of the Audit Committee are as follows:
To implement the objectives, strategies and comprehensive business plans set by the Board for effective
functioning of the Bank.
To report its activities to the Board of Directors on periodical basis and give independent and unbiased opinion on
the financial statements based on the findings of Statutory Auditors and other Inspection Teams of Internal &
External Authorities.
To review the merit and accuracy of financial reporting process, degree of effectiveness of the Banks internal
control system and management of financial reporting process, the system of internal control and management of
financial risks, the audit process and the Banks risk management process.
To review the Banks existing IT governance and security infrastructure including IT system audit and its control
mechanism to protect the IT based fraud and forgery as per guidelines of Regulatory Bodies.
To assist the Management for maintaining close liaison between the Board and management, Shareholders,
Depositors and other Stake-holders through fair and transparent dissemination of facts, which will help to create
the confidence in the corporate arena.
To evolve an effective process, policies and procedure for fair financial disclosure, developing a industry best
practices internal controlling system and maintaining liaison with Internal and External Auditors to minimize
various post audit business operational risks.
The Audit Committee of the Board of Directors of National Credit and Commerce Bank Ltd. was constituted in accordance
with Bangladesh Bank BRPD Circular No. 11 dated 27 October 2013 and Notification on Corporate Governance issued by
BSEC on 07 August 2012. The Audit Committee of NCCBL Board was last re-constituted in the 282nd Board Meeting held on
March 03, 2014 with the following Board members:
The Company Secretary acts as the Secretary of the Audit Committee of the Board.
Inline with the Audit Plan-2014, the Audit Committee carried out its activities successfully to attain its prime objectives and
other relevant responsibilities as per its Terms of Reference, with the assistance of the Board of Directors of the Bank as per
Internal Control
The Committee:
Evaluates whether the Management is setting the appropriate compliance culture by communicating the importance of
internal control and other risk factors and ensuring that all employees are aware of their roles and
responsibilities;
Reviews the arrangements made by the management for building a suitable Management Information System
(MIS) including computerization system and its applications;
Considers whether internal control strategies recommended by Internal and External Auditors have been
implemented by the Management;
Reviews the existing risk management procedures for ensuring an effective internal check and control system;
Reviews the corrective measures taken by the Management as regards the reports relating to fraud-forgery, deficiencies
in internal control or other similar issues, detected by Internal and External Auditors and Inspection Team of the
Regulatory Authority and inform the Board on a regular basis.
Financial Reporting
The Committee:
Reviews the annual financial statements and determines whether this is complete and consistent with the accounting
standards set by the Regulatory Authority;
Meets with Management and the External Auditors to review the financial statements before its finalization.
Internal Audit
The Committee:
Reviews the activities and organizational structure of the internal audit function and ensures that no unjustified
restrictions or limitations are made;
Reviews the efficiency and effectiveness of internal audit function;
Reviews that findings and recommendations made by the Internal Auditors for removing the irregularities detected and
also gives necessary advices to the Bank Management for running the affairs of the bank efficiently.
External Audit
The Committee:
Reviews the auditing performance of the External Auditors and their audit reports
Reviews the findings and recommendations made by the External Auditors for removing the irregularities detected and
also running the affairs of the Bank through the Management;
Makes recommendations to the Board of Directors of the Bank regarding appointment of the External Auditors.
Advices for compliance with existing laws and Regulations;
Other Responsibilities
The Committee:
Places compliance report before the Board on quarterly basis regarding regularization of the errors & omissions and
actions suggested to resolve fraud and forgeries and other irregularities as detected by the Internal and External
Auditors and Inspection Teams of Regulatory Authorities;
Performs other oversight functions as requested by the Board from time to time and evaluates the Committees own
performance on regular basis.
The Audit Committee of the Board held 17 (seventeen) meetings during the year 2014 and held detailed discussions on the
findings of Internal Control & Compliances Division on the branches as well as on Head Office Divisions/Departments as
placed in its meetings. It gives prudent advices to the Management for improvement of Banks financial health and gives
proper advices to the Management to move in the right path.
The Audit Committee, among others, discharged the following responsibilities during the year:
Internal Control
The Committee reviewed the existing internal control system in the company to introduce the appropriate compliance
culture as under:
Internal Audit
The Committee introduced various formats to report facts & figures in a prudent way to the Committee.
The Committee reviewed the efficiency and effectiveness of internal audit functions.
The Committee reviewed the audit and inspection reports on branches and departments of Head Office of the Bank from
time to time and gave necessary instructions to the Management to ensure compliance.
External Audit
The Committee recommended the appointment of External Auditors.
The Committee finalized the Audit Report and Annual Financial Statements of the Bank for the year under report.
The Committee reviewed and discussed on the letter issued by the External Auditors on the Management.
The Minutes of the meetings of the Audit Committee were regularly placed in the meeting of the Board of Directors for
perusal and approval of the recommendations of the Committee.
The Audit committee expressed its sincere thanks to the Members of the Board of Directors of the Bank Management Team
and the External Auditors for extending their excellent support in carrying out the duties and responsibilities of the
Committee satisfactorily during the year 2014.
We have reviewed accompanying consolidated financial statements of NCC Bank Limited and its subsidiaries (the
Group) as well as the financial statements of NCC Bank Limited (the Bank) which comprise the consolidated and the
separate balance sheet as at 31 December 2014, profit and loss account, statement of changes in equity, cash flow
statement for the year then ended, and a summary of significant accounting policies and other explanatory notes.
These financial statements have been prepared and presented fairly in accordance with Bangladesh Accounting
Standards (BASs) and Bangladesh Financial Reporting Standards (BFRSs), The First Schedule (section 38 of the
Bank Companies Act 1991, as amended by the BRPD Circular no. 14 dated 25 June 2003, other Bangladesh Bank
Circulars, the Companies Act 1994, The Securities and Exchange Rules 1987, Dhaka and Chittagong Stock Exchanges
listing regulations and other laws and rules applicable in Bangladesh.
The Bank has taken proper and sufficient care in installing a system of internal control, which is reviewed, evaluated and
updated on an ongoing basis. The Internal Control & Compliance Department of the Bank conducts periodic audits to
provide reasonable assurance that the established policies and procedures of the bank were consistently followed.
Based on the internal control system of the bank and our review of these financial statements, we certify that to the best
of our knowledge and belief:
i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that
might be misleading;
ii) these statements together present a true and fair view of the Banks affairs and are in compliance with existing
accounting standards and applicable laws;
iii) no transactions entered into by the Bank during the year which are fraudulent, illegal or violation of the banks code
of conduct.
Dated,Dhaka
05 May 2015
We have audited the accompanying consolidated financial statements of NCC Bank Limited and its subsidiaries (the
Group") as well as the separate financial statements of NCC Bank Limited (the Bank), which comprise the
consolidated and separate balance sheets as at 31 December 2014, and the consolidated and separate profit and loss
accounts, consolidated and separate statements of changes in equity and consolidated and separate cash flow
statements for the year then ended including a summary of significant accounting policies and other explanatory
information.
Management is responsible for the preparation of consolidated financial statements of the Group and also separate
financial statements of the Bank that give a true and fair view in accordance with Bangladesh Financial Reporting
Standards as explained in note# 2.1 and for such internal control as management determines is necessary to enable
the preparation of consolidated financial statements of the Group and also separate financial statements of the Bank
that are free from material misstatement, whether due to fraud or error. The Bank Company Act, 1991 and the
Bangladesh Bank Regulations require the Management to ensure effective internal audit, internal control and risk
management functions of the Bank. The Management is also required to make a self-assessment on the effectiveness
of anti-fraud internal controls and report to Bangladesh Bank on instances of fraud and forgeries.
Auditor's Responsibility
Our responsibility is to express an opinion on these consolidated financial statements of the Group and the separate
financial statements of the Bank based on our audit. We conducted our audit in accordance with Bangladesh
Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the
audit to obtain reasonable assurance about whether the consolidated financial statements of the Group and separate
financial statements of the Bank are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
consolidated financial statements of the Group and separate financial statements of the Bank. The procedures
selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the
consolidated financial statements of the Group and separate financial statements of the Bank, whether due to fraud
or error. In making those risk assessments, the auditor considers internal control relevant to the entitys preparation
of consolidated financial statements of the Group and separate financial statements of the Bank that give a true and
fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by
management, as well as evaluating the overall presentation of the consolidated financial statements of the Group and also
separate financial statements of the Bank.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.
Opinion
In our opinion, the consolidated financial statements of the Group and also separate financial statements of the Bank
give a true and fair view of the consolidated financial position of the Group and the separate financial position of the
Bank as at 31 December 2014, and of its consolidated and separate financial performance and its consolidated and
separate cash flows for the year then ended in accordance with Bangladesh Financial Reporting Standards as
explained in note# 2.1.
In accordance with the Companies Act 1994, Securities and Exchange Rules 1987, the Bank Company Act, 1991 and
the rules and regulations issued by Bangladesh Bank, we also report the following:
(a) we have obtained all the information and explanation which to the best of our knowledge and belief were
necessary for the purpose of our audit and made due verification thereof;
(b) to the extent noted during the course of our audit work performed on the basis stated under the Auditors
Responsibility section in forming the above opinion on the consolidated financial statements of the Group and
the separate financial statements of the Bank and considering the reports of the Management to Bangladesh
Bank on anti-fraud internal controls and instances of fraud and forgeries as stated under the Managements
Responsibility for the Financial Statements and Internal Controls;
i) internal audit, internal control and risk management arrangements of the Group and the Bank, as disclosed in
note# 2.20 of the financial statements, appeared to be materially adequate;
ii) nothing has come to our attention regarding material instances of forgery or irregularity or administrative
error and exception or anything detrimental committed by employees of the Bank and its related entities other
than matters disclosed in note # 2.32 of these financial statements;
(c) financial statements of subsidiary, NCCB Securities and Financial Services Limited, of the Bank have been
audited by Shafiq Mizan Rahman and Augustine, Chartered Accountants, financial statements of subsidiary,
NCCB Capital Limited (NCCBCL), of the Bank have been audited by Hoda Vasi Chowdhury & Co., Chartered
Accountants, and the financial statements of another subsidiary, NCCB Exchange (UK) Limited, of the Bank
have been verified by Shahidullah & Co., Certified Chartered Accountants and have been properly reflected in
the consolidated financial statements;
(d) in our opinion, proper books of account as required by law have been kept by the Group and the Bank so far
as it appeared from our examination of those books;
(e) the consolidated balance sheet and consolidated profit and loss account of the Group and the separate
balance sheet and separate profit and loss account of the Bank dealt with by the report are in agreement with
the books of account;
(f) the expenditure incurred was for the purposes of the Banks business;
(g) the consolidated financial statements of the Group and the separate financial statements of the Bank have
been drawn up in conformity with prevailing rules, regulations and accounting standards as well as with
related guidance issued by Bangladesh Bank;
(h) adequate provisions have been made for advances which are, in our opinion, doubtful of recovery;
(i) the records and statements submitted by the branches have been properly maintained and consolidated in the
financial statements;
(j) the information and explanation required by us have been received and found satisfactory; and
(k) we have reviewed over 80% of the risk weighted assets of the Bank and we have spent around 4130 person
hours for the audit of the books and accounts of the Bank.
Dated,Dhaka ACNABIN
06 May 2015 Chartered Accountants
Balance with other banks and financial institutions 6(a) 2,414,393,658 670,604,823 1,320,030,633
In Bangladesh 471,533,599 341,687,470 1,088,828,360
Outside Bangladesh 1,942,860,059 328,917,353 231,202,273
Liabilities
These financial statements should be read in conjunction with the annexed notes from 1 to 43.
Dated,Dhaka ACNABIN
06 May 2015 Chartered Accountants
2014 2013
Notes
Taka Taka
These financial statements should be read in conjunction with the annexed notes from 1 to 43.
Dated,Dhaka ACNABIN
06 May 2015 Chartered Accountants
These financial statements should be read in conjunction with the annexed notes from 1 to 43.
Other Non-
Paid up Statutory General reserve-assets controlling
F.C. Translation Retained Total
Particulars Capital Reserve Reserve revaluation (Minority) gain/(Loss) earnings
reserve Interest
Taka Taka Taka Taka Taka Taka Taka Taka
Balance at 1st January 2014 7,646,909,130 4,283,417,675 10,162,348 450,761,512 215 910,171 889,752,897 13,281,913,948
80
bonds) HFT made during the year - - - - - - - -
Surplus/(deficit) on account of revaluation of Govt. -
securities (treasury bills/bonds) HTM & HFT
transferred to income A/C - - - 37,615,685 - - - 37,615,685
Currency translation gain/(loss) - - - - - 1,485,538 - 1,485,538
Net gains and losses not recognized in the
income Statement - - - - - - - -
Minority interest - - - - - - - -
Bonus share for the year 2013 382,345,450 - - - - - (382,345,450) -
Net profit for the year - - - - - - 1,494,682,198 1,494,682,198
Transfer to statutory reserve - 500,095,692 - - - - (500,095,692) -
Cash Dividend for the year 2013 - - - - - - (458,814,548) (458,814,548)
Balance at 31 December 2014 8,029,254,580 4,783,513,367 10,162,348 484,862,319 215 2,395,709 1,046,694,283 14,356,882,821
Balance at 31 December 2013 7,646,909,130 4,283,417,675 10,162,348 450,761,512 215 910,171 889,752,897 13,281,913,948
Balance with other banks and financial institutions 6 2,407,581,410 656,757,606 1,316,317,832
In Bangladesh 468,186,926 328,019,533 1,087,904,404
Outside Bangladesh 1,939,394,484 328,738,073 228,413,428
Liabilities
Borrowings from other banks, financial
institutions and agents 12 4,975,525,649 2,763,533,530 9,444,527,760
These financial statements should be read in conjunction with the annexed notes from 1 to 43.
Dated,Dhaka ACNABIN
06 May 2015 Chartered Accountants
These financial statements should be read in conjunction with the annexed notes from 1 to 43.
Dated,Dhaka ACNABIN
06 May 2015 Chartered Accountants
These financial statements should be read in conjunction with the annexed notes from 1 to 43.
Balance at 1st January 2014 7,646,909,130 4,283,417,675 10,162,348 450,761,512 2518 878,582,631 13,269,835,814
Depreciation on revaluation of properties - - - (3,514,878) - 3,514,878 -
Revaluation of Govt. Securities (treasury bills/bonds)
HFT made during the year - - - - - - -
Surplus/(deficit) on account of revaluation of Govt.
securities (treasury bills/bonds) HTM & HFT
transferred to income A/C - - - 37,615,685 - - 37,615,685
Currency translation differences - - - - (276,637) - (276,637)
Net gains and losses not recognized in the - -
income statement - - - - - - -
Bonus share for the year 2013 382,345,450 - - - - (382,345,450) -
Net profit for the year - - - - - 1,501,329,218 1,501,329,218
Appropriations during the year
Transfer to statutory reserve - 500,095,692 - - - (500,095,692) -
Cash Dividend for the year - - - (458,814,548) (458,814,548)
Balance at 31 December 2014 8,029,254,580 4,783,513,367 10,162,348 484,862,319 (276,637) 1,042,173,555 14,349,689,532
Balance at 31 December 2013 7,646,909,130 4,283,417,675 10,162,348 450,761,512 2,518 878,582,631 13,269,835,814
"Not more than 1-3 months term 3-12 months term 1-5 years term Above 5-years Total
Particulars 1 month term" term
Assets:
Cash in hand 1,173,484,082 - - - - 1,173,484,082
86
and financial institutions" 2,782,663,019 - - - 7,063,595,217 9,846,258,236
Money at call & short notice - - - - - -
Investments 2,008,202,315 826,915,409 2,276,429,665 10,267,604,816 11,189,509,557 26,568,661,762
Loans & advances 15,510,652,045 19,536,439,633 26,781,203,143 17,816,400,961 11,276,076,246 90,920,772,028
Fixed assets including land, building, .
furniture & fixtures - - 143,325,505 416,904,179 2,013,022,422 2,573,252,105
Other assets 168,800,631 360,969,156 1,074,556,052 170,758,555 2,302,010,932 4,077,095,326
Non-banking assets - - - - - -
Total assets 21,643,802,092 20,724,324,198 30,275,514,365 28,671,668,511 33,844,214,374 135,159,523,539
Liabilities:
Borrowing from other banks, financial
institutions & agents 1,766,986,059 87,515,470 221,926,457 1,010,309,020 1,888,788,643 4,975,525,649
Deposits 16,028,608,399 23,699,602,570 23,391,340,830 24,237,651,715 16,307,786,079 103,664,989,593
Bills payable 2,038,624,517 - - - - 2,038,624,517
Provision & other liabilities 839,709,930 409,189,299 3,790,128,822 3,496,043,552 1,595,622,645 10,130,694,248
Total liabilities 20,673,928,905 24,196,307,339 27,403,396,109 28,744,004,287 19,792,197,368 120,809,834,007
Net liquidity gap 969,873,187 (3,471,983,141) 2,872,118,256 (72,335,776) 14,052,017,006 14,349,689,532
Net result of the liquidity statement represents the 'shareholders' equity' of the bank.
The National Credit and Commerce Bank Limited (NCCBL) was formed as a public limited banking company
incorporated in Bangladesh with primary objective to carry on all kinds of banking business in and outside
Bangladesh.
The registered office of the Bank is located at NCC Bank Bhaban, 13/1-2 Toyenbee Circular Road, Motijheel
Commercial Area, Dhaka-1000 (Previously the registered office situated at 7-8 Motijheel C/A, Dhaka-1000). It
commenced its banking business with 16 branches from May 17, 1993 under the license issued by Bangladesh Bank.
Presently the Bank has 103 branches all over Bangladesh and 02 (Two) booths at Uttara Model Town, Uttara, Dhaka
and Maniknagar, North Golapbagh, Dhaka. The bank has no overseas branch as at 31 December 2014. It carries out
all banking activities through it branches in Bangladesh. The Bank went for initial public offering in 1999 and its share
is listed with Dhaka and Chittagong Stock Exchange Limited as a publicly traded company.
The principal activities of the Bank are to provide all kinds of commercial banking services to its customers through
its branches.
Offshore Banking Unit (OBU) is a separate business unit of NCC Bank Limited governed under the rules and guidelines
of Bangladesh Bank. The Bank obtained permission for operation of offshore banking units located at Foreign
Exchange Branch & Agrabad Branch vide Bangladesh Bank letter no. BRPD (P-3)744(113)/2010-1648 dated 02 May
2010. The Bank commenced the operation of its offshore banking units from 26 August 2013 at Foreign Exchange
branch, Dhaka and operation of OBU located at Agrabad branch, Chittagong will be started within very soon. Separate
financial statements of offshore banking units are shown in Annexure-N.
NCCB Securities and Financial Services Limited is a Subsidiary Company of NCC Bank Limited incorporated as a
Private Limited Company on April 04, 2010 with the Registrar of Joint Stock Companies and Firms vide certificate of
incorporation no.C-83683/10 dated April 04, 2010 under the Companies Act-1994. NCCBSFSL commenced its
operation from March 07, 2011. The Main objective of the company is to act as a full fledged Stock Broker & Stock
Dealer to execute buy and sell order and to maintain own portfolio as well as customers portfolio under the discretion
of customers. The company also performs the other activities relates to Capital Market as and when regulators permit
the company to carry out activities as per their guidelines. Financial statements of 2014 of the company are shown in
Annexure-O
NCCB Capital Limited (NCCBCL) is a Subsidiary Company of NCC Bank Limited incorporated as a Private Limited
Company on April 01, 2010 with the Registrar of Joint Stock Companies and Firms vide certificate of incorporation
no.C-83649/10 dated April 01, 2010 under the Companies, Act-1994. The Main objective of the company is to provide
fledged merchant banking services like issue management, underwriting, advisory services & as and when regulators
permits the company to carry out activities as per their guidelines. NCCBCL was not in operation till December 31,
2014. Financial statements of the company are shown in Annexure-P
NCCB Exchange (UK) Limited is a fully owned Subsidiary Company, incorporated as a Private Limited company with
the Registrar of Companies for England and Wales under registration no. 7669773 dated June 14, 2011. NCC Bank
Limited got permission from Bangladesh Bank vide letter no. BRPD/(M)204/28/2011-123 dated June 13, 2011 for
opening a fully owned subsidiary company with two branches at London and Birmingham in UK. NCCB Exchange
(UK) Limited obtained Money Laundering registration on July 28, 2011 issued by HM Revenue & Customs. The
Company got registration from Financial Services Authority (FSA) vide reference no PSD/557817 dated October 26,
2011 to carry on payment services activities under the Payment Services Regulations 2009 (PRSs). Financial
Statements of the company are shown in Annexure-Q
The financial statements namely, Balance Sheet, Profit and Loss Accounts, Cash Flow Statement, Statement of
Changes in Equity, Liquidity Statement and relevant notes and disclosures thereto, of the Bank are prepared on a
going concern basis under the historical cost convention, and in accordance with First Schedule of the Banking
Companies Act 1991, as amended, BRPD circular no. 14 of 25 June 2003, other Bangladesh Bank circulars,
International Accounting Standards, and International Financial Reporting Standards adopted in Bangladesh as
Bangladesh Accounting Standards (BAS), and Bangladesh Financial Reporting Standards (BFRS) as adopted by the
Institute of Chartered Accountants of Bangladesh, the Companies Act 1994, the Bangladesh Securities and Exchange
Rules 1987. Wherever appropriate, such principles are explained in succeeding notes.
Statement of compliance
The financial statements of the Bank are prepared in accordance with Bangladesh Financial Reporting Standards
(BFRS) and the requirements of the Bank Companies Act 1991, the rules and regulations issued by Bangladesh Bank,
the Companies Act 1994, Securities and Exchange Rules 1987. In case any requirement of the Bank Companies Act
1991, and provisions and circulars issued by Bangladesh Bank differ with those of BFRS, the requirements of the
Bank Companies Act 1991, and provisions and circulars issued by Bangladesh Bank shall prevail. Material departures
from the requirements of BFRS are as follows:
BFRS: As per requirements of BAS 39 investment in shares and securities generally falls either under at fair value
through profit and loss account or under available for sale where any change in the fair value (as measured in
accordance with BFRS 13) at the year-end is taken to profit and loss account or revaluation reserve respectively.
Bangladesh Bank: As per BRPD circular no. 14 dated 25 June 2003 investments in quoted shares and unquoted
shares are revalued at the year end at market price and as per book value of last audited balance sheet respectively.
Provision should be made for any loss arising from diminution in value of investment; otherwise investments are
recognized at cost.
BFRS: As per requirement of BAS 39 where securities will fall under the category of Held for Trading (HFT), any
change in the fair value of held for trading assets is recognized through profit and loss account. Securities designated
as Held to Maturity (HTM) are measured at amortized cost method and interest income is recognized through the
profit and loss account.
Bangladesh Bank: HFT securities are revalued on the basis of mark to market and at year end any gains on revaluation
of securities which have not matured as at the balance sheet date are recognized in other reserves as a part of equity
and any losses on revaluation of securities which have not matured as at the balance sheet date are charged in the
BFRS: As per BAS 39 an entity should start the impairment assessment by considering whether objective evidence of
impairment exists for financial assets that are individually significant. For financial assets that are not individually significant,
the assessment can be performed on an individual or collective (portfolio) basis.
Bangladesh Bank: As per BRPD circular No.14 (23 September 2012), BRPD circular No. 19 (27 December 2012), BRPD
circular No. 05 (29 May 2013) and BRPD circular No.16 (18 November 2014) a general provision at 0.25% to 5% under
different categories of unclassified loans (good/standard loans) has to be maintained regardless of objective evidence of
impairment. Also provision for sub-standard loans, doubtful loans and bad losses has to be provided at 5% to 20%, 5% to
50% and 100% respectively for loans and advances depending on the duration of overdue. Again as per BRPD circular no. 10
dated 18 September 2007 and BRPD circular no. 14 dated 23 September 2012, a general provision at 1% is required to be
provided for all off-balance sheet exposures. Such provision policies are not specifically in line with those prescribed by BAS 39.
BFRS: Loans and advances to customers are generally classified as 'loans and receivables' as per BAS 39 and interest income
is recognized through effective interest rate method over the term of the loan. Once a loan is impaired, interest income is
recognized in profit and loss account on the same basis based on revised carrying amount.
Bangladesh Bank: As per BRPD circular no. 14 dated 23 September 2012, once a loan is classified, interest on such loans are
not allowed to be recognized as income, rather the corresponding amount needs to be credited to an interest in suspense
account, which is presented as liability in the balance sheet.
BFRS: As per BAS 1 Other Comprehensive Income (OCI) is a component of financial statements or the elements of OCI are to
be included in a single Other Comprehensive Income statement.
Bangladesh Bank: Bangladesh Bank has issued templates for financial statements which will strictly be followed by all banks.
The templates of financial statements issued by Bangladesh Bank neither include Other Comprehensive Income nor are the
elements of Other Comprehensive Income allowed to be included in a single Other Comprehensive Income (OCI) Statement.
As such the Bank does not prepare the other comprehensive income statement. However, elements of OCI, if any, are shown
in the statements of changes in equity.
In several cases Bangladesh Bank guidelines categorize, recognize, measure and present financial instruments differently from
those prescribed in BAS 39. As such full disclosure and presentation requirements of BFRS 7 and BAS 32 cannot be made in
the financial statements.
BFRS: As per BAS 39, financial guarantees are contracts that require an entity to make specified payments to reimburse the
holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the terms of a debt
instrument. Financial guarantee liabilities are recognized initially at their fair value, and the initial fair value is amortized over
the life of the financial guarantee. The financial guarantee liability is subsequently carried at the higher of this amortized
amount and the present value of any expected payment when a payment under the guarantee has become probable. Financial
guarantees are included within other liabilities.
Bangladesh Bank: As per BRPD 14, financial guarantees such as letter of credit, letter of guarantee will be treated as
off-balance sheet items. No liability is recognized for the guarantee except the cash margin.
BFRS: Cash and cash equivalent items should be reported as cash item as per BAS 7.
Bangladesh Bank: Some cash and cash equivalent items such as money at call on short notice, treasury bills,
Bangladesh Bank bills and prize bond are not shown as cash and cash equivalents. Money at call on short notice
presented on the face of the balance sheet, and treasury bills, prize bonds are shown in investments.
Bangladesh Bank: As per BRPD 14, there must exist a face item named Non-banking asset.
BFRS: The Cash flow statement can be prepared using either the direct method or the indirect method. The
presentation is selected to present these cash flows in a manner that is most appropriate for the business or industry.
The method selected is applied consistently.
Bangladesh Bank: As per BRPD 14, cash flow is the mixture of direct and indirect methods.
BFRS: Balance with Bangladesh Bank should be treated as other asset as it is not available for use in day to day
operations as per BAS 7.
Bangladesh Bank: Balance with Bangladesh Bank is treated as cash and cash equivalents.
BFRS: An intangible asset must be identified and recognized, and the disclosure must be given as per BAS 38.
BFRS: There is no concept of off-balance sheet items in any BFRS; hence there is no requirement for disclosure of
off-balance sheet items on the face of the balance sheet.
Bangladesh Bank: As per BRPD 14, off balance sheet items (e.g. Letter of credit, Letter of guarantee etc.) must be
disclosed separately on the face of the balance sheet.
Bangladesh Bank: As per BRPD 14, provision on loans and advances/investments are presented separately as liability
and cannot be netted off against loans and advances.
The Consolidated Financial Statements include the financial statements of NCC Bank Limited and its subsidiary
companies NCCB Securities and Financial Services Limited, NCCB Capital Limited & NCCB Exchange (UK) Limited
made up to the end of the 31 December 2014. The consolidated financial statements have been prepared in
accordance with Bangladesh Accounting Standards 27-Consolidated & Separate Financial Statements. The
Consolidated Financial Statements are prepared to common financial year ending 31 December 2014.
Subsidiary is that enterprise controlled by the bank. Control exists when the Bank has the power, directly and
indirectly, to govern the financial and operating policies of an enterprise from the date that control commences until
the date that control ceases. The financial statements of subsidiary are included in the consolidated financial
statements from the date that the control effectively commences until the date that it control effectively ceases.
Subsidiary company is consolidated using the purchase method of accounting. The conversion policy for assets and
liabilities & income and expense items of NCCB Exchange (UK) Limited using closing exchange rate and average
exchange rate respectively.
All intra-group transactions, balances, income and expenses are eliminated on consolidation. Profit and loss resulting
from transactions is also eliminated on consolidation.
In the preparation of financial statements, management requires to make judgments, estimates and assumptions that
affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses.
Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an on going basis. Revisions to accounting estimates are
recognized in the period in which the estimate is revised and in any future periods affected.
The financial statements are presented in Bangladeshi Taka which is the bank's functional currency except as
indicated.
Foreign currency transactions are converted into equivalent taka using the ruling exchange rates on the dates of
respective transactions as per BAS-21 The Effects of Changes in Foreign Exchange Rates. Assets and liabilities in
foreign currencies at 31 December 2014 have been converted into Taka currency at the average of the prevailing
buying and selling rates of the relevant foreign currencies at that date except "Balances with other Banks and Financial
Institutions" which have been converted as per directives of Bangladesh Bank vide its circular no. BRPD(R)
717/2004-959 dated 21 November 2004.
b) Commitments
Contingent liabilities / commitments for letters of credit and letters of guarantee denominated in foreign currencies
are expressed in Taka terms at the rates of exchange ruling on the balance sheet date.
The resulting exchange transaction gains and losses are included in the profit and loss account, except those arising
on the translation of net investment in foreign subsidiary.
Consolidation, foreign exchange differences arising from the translation of net investments in foreign entities are
taken into capital reserve. When a foreign operation is disposed of, such currency translation differences are
recognized in the income statement as part of the gain or loss on disposal.
Cash flow statement has been prepared in accordance with the BRPD Circular No. 14, dated June 25, 2003 issued by
the Banking Regulation & Policy Department of Bangladesh Bank. It reported cash flows during the period classified
by operating activities, investing activities and financing activities.
The liquidity statement of assets and liabilities as on the reporting date has been prepared on residual maturity term
as per the following bases.
i) Balance with other banks and financial institutions, money at call and short notice, etc. are shown on the basis
of their maturity term;
ii) Investments are on the basis of their respective maturity;
iii) Loans and advances / investments are on the basis of their repayment schedule;
iv) Fixed assets are on the basis of their useful lives;
v) Other assets are on the basis of their realization / amortization;
vi) Borrowing from other banks, financial institutions and agents, etc. are as per their maturity / repayment terms;
vii) Deposits and other accounts are on the basis of their maturity term and past trend of withdrawal by the
depositors;
viii) Provisions and other liabilities are on the basis of their payment / adjustments schedule.
These financial statements cover for the period from 01 January to 31 December 2014.
2.9 Offsetting
Financial assets and financial liabilities are offset and the net amount reported in the balance sheet when there is a
legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis, realize the
asset and settle the liability simultaneously.
Cash and cash equivalents include notes and coins on hand, unrestricted balances held with Bangladesh Bank and
highly liquid financial asset which are subject to insignificant risk of changes in their fair value and are used by the
bank management for its short-term commitments.
a) Loans and advances are stated in the balance sheet on gross basis.
b) Interest is calculated on a daily product basis but charged on quarterly basis and accounted for on accrual basis.
Interest on classified loans and advances are kept in suspense account as per Bangladesh Bank instructions and such
interest is not accounted for as income until realized from borrowers [please refer Note- 9.10 (x)]. Interest is not
charged on bad and loss loans as per guidelines of Bangladesh Bank. Records of such interest amounts are kept in
separate memorandum accounts.
c) Provision for loans and advances is made on the bases of quarter-end review by the management following
instructions contained in Bangladesh Bank BCD Circular no. 34 dated 16 November 1989, BCD Circular no. 20 dated
27 December 1994, BCD Circular no. 12 dated 4 September 1995, BRPD Circular 16 dated 6 December 1998, BRPD
Circular no. 9 dated 14 May 2001, BRPD Circular no. 09 of August 2005 and BRPD Circular no.17 dated 06 December 2005,
2.10.3 Investments
All investment securities are initially recognized at cost, being fair value of the consideration given, including
acquisition charges associated with the investment. Premiums are amortized and discounts accredited, using the
effective yield method and are taken to discount income. The valuation methods of investments used are:
Investments which have fixed or determinable payments and are intended to be held to maturity other than those
that meet the definition of held at amortized cost-others are classified as held to maturity. These investments are
subsequently measured at present value as per Bangladesh Bank guideline. Investments in securities have been
revalued as mark to market as at December 31, 2014. The gain of revaluation from the held to maturity securities has
been shown in the statement of changes in equity of December 31, 2014.
Investments classified in this category are acquired principally for the purpose of selling or repurchasing in short-trading
or if designated as such by the management after initial recognition, investments are measured at fair value and any
change in the fair value is recognized in the statement of income for the period in which it arises. These investments are
subsequently revalued at current market value on weekly basis as per Bangladesh Bank guidelines. Revaluation gain has
been shown in revaluation reserve account & revaluation loss has been shown in profit & loss account.
Value of investments has been enumerated as follow:
Item Applicable accounting value
Government treasury bills-HTM Amortized value
Government treasury bills-HFT Market value
Government treasury bonds-HTM Amortized value
Government treasury bonds-HFT Market value
Prize bonds At cost
These securities are bought and held primarily for the purpose of selling them in future or held for dividend income.
Unrealized gains are not recognized in the profit and loss account. But provision for diminution in value of investment
is provided in the financial statements which market price is below the cost price of investment (Note-8.3).
Investment in unquoted securities is reported at cost under cost method. Adjustment is given for any shortage of
book value over cost for determining the carrying amount of investment in unquoted securities.
Investment in subsidiary
Investment in subsidiary is accounted for under the cost method of accounting in the Banks financial statements in
accordance with the BAS-27. Accordingly Investment in subsidiary is stated in the Banks Balance Sheet at cost, less
impairment losses if any.
All fixed assets except land and buildings/apartments are stated at historical cost and land and Building/Apartments
at revalued amount (whenever applicable) less accumulated depreciation as per BAS -16 Property, Plant and
Equipment. The cost of acquisition of an asset comprises its purchase price and any directly attributable cost of
bringing the assets to its working condition for its intended use inclusive of inward freight, duties and non refundable
taxes.
Subsequent cost:
The cost of replacing part of such an item of fixed assets is recognized in the carrying amount of an item of property,
plant and equipment if it is probable that the future economic benefits embodied with the part will flow to the company
and the cost of the item can be measured reliably. The cost of day to day servicing of fixed asset is recognized in profit
and loss as incurred.
Depreciation:
Depreciation is charged for the year at the following rates on reducing balance method on all fixed assets other than
vehicles and software on which straight line depreciation method is followed and no depreciation is charged on land:
a) For additions during the year, depreciation is charged for the remaining days of the period and for disposal
depreciation is charged up to the date of disposal.
b) On disposal of fixed assets the cost and accumulated depreciation are eliminated from the fixed assets schedule
and gain or loss on such disposal is reflected in the profit and loss account which is determined with reference to
the net book value of the assets and net sale proceeds.
a) An intangible asset is recognized if it is probable that the future economic benefits that are attributable to the
asset will flow to the entity and the cost of assets can be measured reliably.
Other assets have been classified as per BRPD circular no. 14 dated 25.06.2001 of Bangladesh Bank and necessary
provisions made thereon accordingly and for item not covered under the circular adequate provision have been
made considering their recoverability.
Securities purchase under re-sale agreements are treated as collateralized lending and recorded at the consideration
paid and interest accrued thereon. The amount lent is shown as an asset either as loans and advances to customers
or loans to other banks.
The difference between purchase price and resale price is treated as interest received and accrued evenly over the
life of REPO agreement.
2.10.8 Receivables
Receivables are recognized when there is a contractual right to receive cash or another financial asset from another
entity.
2.10.9 Inventories
2.10.10 Leasing
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risk and
rewards of ownership to the lessee as per BAS-17 Lease.
Amount due from lessees under finance leases are recorded as receivables at the amount of the Banks Loans and
Advances in the leases.
There are no assets acquired in exchange for loan during the year of financial statements.
Accounts with regard to inter-bank (in Bangladesh and outside Bangladesh) are reconciled regularly and there are
Un-reconciled entries / balances in case of inter-branch transaction as on the reporting date are not material.
Ordinary shares are classified as equity when there is no contractual obligation to transfer cash or other financial
assets.
Bank Companies Act, 1991 (Amendment up to 2013) requires the bank to transfer not less than 20% of its current
period profit before tax to reserve until such reserve equals to its paid up capital.
When an assets carrying amount is increased as a result of a revaluation, the increased amount credited directly
to equity under the heading of revaluation surplus/reserve as per BAS-16: Property, Plant and Equipment. The
Bank revalued the assets of Land and Buildings which is absolutely own by the Bank and the increased amount
transferred to revaluation reserve.
Minority interest in business is an accounting concept that refers to the portion of a subsidiary corporations stock
that is not owned by the parent corporation. The magnitude of the minority interest in the subsidiary company is
always less than 50% of outstanding shares; else the corporation would cease to be a subsidiary of the parent.
Minority interest belongs to other investors and is reported on the consolidated balance sheet of the owing
company to reflect the claim on assets belonging to other, non-controlling shareholders. Also, minority interest is
reported on the consolidated income statement as a share of profit belonging to minority shareholders.
Deposits by customers and banks are recognized when the bank enters into contractual provisions of the
arrangements with the counterparties, which is generally on trade date, and initially measured at the consideration
received.
Borrowed fund include call money deposits, borrowings, re-finance borrowings and other term borrowings from
banks. They are stated in the balance sheet at amounts payable. Interest paid/payable on these borrowings is
charged to the income statements.
The current tax payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the
Profit & Loss Account because it excludes items of income or expense that are taxable or deductible. The Bank's
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the date of
Balance Sheet.
Provision for current income tax has been made @ 42.5% on accounting profit made by the Bank after considering
some of the add backs of income and disallowances of expenditure as per Income Tax Ordinance 1984.
Deferred tax liabilities are the amount of income taxes payable in future periods in respect of taxable temporary
differences. Deferred tax assets are the amount of income taxes recoverable in future periods in respect of
deductible temporary differences. Deferred tax assets and liabilities are recognized for the future tax consequences
of timing difference arising between the carrying values of assets, liabilities, income and expenditure and their
respective tax bases. Deferred tax assets & liabilities are measured using tax rates and tax laws that have been
enacted or substantially enacted at the balance sheet date. The impact on the account of changes in the deferred tax
assets and liabilities has also been recognized in the profit and loss account as per BAS -12 Income Taxes.
The retirement benefits accrued for the employees of the bank as on reporting date have been accounted for in
accordance with the provisions of BAS-19 Employee Benefits. The bank operates retirement benefits scheme for
its permanent employees. Elements of which are as under:
a) Provident fund
Provident fund benefits are given to the permanent employees of the bank in accordance with banks service rules.
Accordingly a trust of deed and provident fund rules were prepared. The Commissioner of Income Tax, Taxes
Zone-04, Dhaka has approved the provident fund as a recognized provident fund within the meaning of section
2(52), read with the provisions of part - B of the First Schedule of Income Tax Ordinance 1984. The recognition took
effect from 16.01.1992. The fund is operated by a Board of Trustees consisting 06 (six) members. All confirmed
employees of the bank are contributing 10% of their basic salary as subscription to the fund. The bank also
contributes equal amount of the employees contribution. Interest earned from the investments is credited to the
members account on yearly basis.
b) Gratuity fund
The bank has operated funded gratuity fund which was approved by National Board of Revenue on 17.09.2009. The
fund is operated Board of Trustees. Provision in respect of which is made annually covering all its permanent eligible
employees as per BAS-19 Employee Benefits.
c) Superannuation fund
The bank operates an employees Superannuation Fund Trust by a separate Board of Trustees consisting of 05 (Five)
members. The death-cum survival benefits are given to the employees as per the eligibility narrated in the Trust
Rules. The fund got recognition from the National Board of Revenue (NBR) effect from 01.01.2004 under the section
3 and 4 of part A of First Schedule of Income Tax Ordinance 1984. The bank contributes to the fund annually as per
Superannuation Fund Rules of the bank.
d) Benevolent Fund
NCCBL employees benevolent fund was established in the year 2007 for the welfare of the distressed employees
and their dependents. The employees of the bank contribute to the fund at a rate applicable for each grade from their
monthly salary.
A provision is recognized in the balance sheet when the bank has a legal or constructive obligation of a result of a
past event and it is probable that an outflow of economic benefit will be required to settle the obligation in
accordance with the BAS-37 Provisions, Contingent Liabilities and Contingent Assets.
Off-balance sheet items have been disclosed under contingent liabilities and other commitments as per Bangladesh
guidelines. As per BRPD Circular no.10 dated September 18, 2007 & BRPD Circular no.14 dated September 23,
2012, Banks are advised to maintain provision @ 1.00% against Off-balance sheet exposure in addition to the
existing provisioning arrangement.
As per instructions contained in the circular letter no. FEPD (FEMO)/01/2005-677 dated September 13, 2005 issued
by Foreign Exchange Policy Department of Bangladesh Bank, Banks are required to make provision regarding the
un-reconciled debit balance of NOSTRO account over more than three months as on the reporting date in these
financials. Since there are no un-reconciled entries which are outstanding more than three months then Banks are
not required to make provision.
In terms of the provision of the BAS-18 Revenue the interest income is recognized on accrual basis. Interest on
loans and advances ceases to be taken in to income when such advances are classified. It is than kept in interest
suspense in a memorandum account. Interest on classified loans and advances is accounted for on a cash receipt
basis.
Interest income on investments is recognized on accrual basis. Capital gain on investments in shares is also
included in investment income. Capital gain is recognized when it is realized.
Fees and commission income arises on services provided by the bank are recognized on a cash received basis.
Commission charged to customer on letters of credit and letters of guarantee is credited to income at the time of
effecting the transactions.
In terms of the provisions of BFRS, interest and other expenses are recognized on accrual basis.
Interim dividends are recognized when they are paid to shareholders. Final dividend is recognized when it is
approved by the shareholders.
Dividend payable to the banks shareholders are recognized as a liability and deducted from the shareholders equity
in the period in which the shareholders right to receive the payment is established.
The risk of the Bank may be defined as the possibility of losses, financial or otherwise. The risk management of the
Bank covers 06 core risks i.e. Credit Risk, Internal Control & Compliance Risk, Money Laundering Risk, Asset
Liability Management Risk (Balance Sheet Risk), Foreign Exchange Risk and Information Technology Risk. As a part
of risk management, adequate capital is maintained against Credit Risk, Market Risk and Operational Risk under
It arises mainly from lending, trade finance, and leasing and treasury business. This can be described as potential
loss arises from the failure of a counter party to perform as per contractual agreement with the bank. The failure may
result from unwillingness of the counter party of decline in his or her financial condition there for the banks credit
risk management activities have been designed to address all these issues.
The Bank has segregated duties of the officers / executives involved in credit related activities a separate corporate
division has been formed at Head office which is entrusted with the duties of maintaining effective relationship with
the customers, marketing of credit products, exploring now business opportunities etc. moreover, credit approval,
administration, monitoring and recovery functions have been segregated. For this purpose, three separate units
have been formed within the credit division these are a) Credit risk Management Unit b) Credit Administration Unit
and c) Credit monitoring and recovery Unit. Credit risk management Unit is entrusted with the duties of maintaining
assets quality, assessing risk in lending to a particular customer, sanctioning credit, formulating policy / strategy for
lending operation, etc. Adequate provision has been made on classified loans is shown in Note 14.5 (a).
A thorough assessment is done before sanction of any credit facility at Credit Risk Management unit. The risk
assessment includes borrower risk analysis, financial analysis, industry analysis, historical performance of the
customer, security of the proposed credit facility, etc. The assessment process starts at Corporate Credit Division by
the Relationship Manager / Officer and ends at Credit Risk Management Unit when it is approved / declined by the
competent authority. Credit approval authority has been delegated to the individual at executives. Proposals beyond
their delegation are approved / declined by the Executives Committee and / or the Management of the Bank. In
determining Single borrower / large loan limit, the instructions of Bangladesh Bank are strictly followed. Internal
audit is conducted at periodical intervals to ensure compliance of Banks and Regulatory policies. Loans are
classified as per Bangladesh Banks guidelines. Concentration of single borrower/large loan limit is shown in
Annexure-C.
Foreign exchange risk is defined as the potential change in earning due to change in market prices. The foreign
exchange risk of the Bank is minimal as all the transactions are carried out on behalf of the customers against
underlying L/C commitments and other remittance requirements. No foreign exchange dealing on Banks account
was conducted during the year.
Treasury Department independently conducts the transactions and the back office of treasury is responsible for
verification of the deals and passing of their entries in the books of account. All foreign exchange transactions are
revalued at Mark-to-Market rate as determined by Bangladesh Bank at the month-end. All NOSTRO accounts are
reconciled on a monthly basis and the management for its settlement reviews outstanding entry beyond 30 days.
The position maintained by the bank at the end of day was within the stipulated limit prescribed by the Bangladesh
Bank.
The Assets Liability Committee (ALCO) of the Bank monitors Market risk and liquidity risks of the bank. The Market
risk is defined as potential charge in earnings due to change in rate of interest, foreign exchange rates which are not
of trading nature. ALCO reviews liquidity requirement of the Bank, the maturity of assets and liabilities, deposit and
lending, pricing strategy and the liquidity contingence plan. The primary objective of the ALCO is to monitor and
avert significant volatility in Net Interest Income (NII), investment value and exchange earnings.
Money Laundering Risk arises from non-compliance of money laundering related instructions of the regulatory
body. It's consequence are dire & far reaching and may be in the form of financial penalty, reputation loss, legal
harassment and even the risk of sustainability. Weakness in money laundering prevention and combating terrorist
financing may lower the image of the Bank in local & global environment. It may also reduce the confidence of the
stakeholders. For involvement in money laundering & terrorist financing, the regulatory bodies may impose
restrictions in expansion of business and Bank may lose the market share. Banks around the globe may be unwilling
to establish correspondent banking relationship if money laundering prevention and combating financing terrorism
status are not up to the mark. The following initiatives have been taken by our Bank to comply with the requirements
of Bangladesh Bank:
Central Compliance Unit (CCU) at Head Office and Branch Compliance Unit (BCU) at branch level have been
formed headed by Chief Anti-Money Laundering Compliance Officer (CAMLCO) and Branch Anti-Money
Laundering Compliance Officer (BAMLCO) respectively.
Policy Guideline on Anti Money Laundering (AML) and Combating Financing Terrorism (CFT) has been
revised & updated complying with Bangladesh Banks instruction & circulars/circular letters.
Uniform Account Opening Form was introduced where KYC is a must. As per Money Laundering Prevention
Act-2012, Bangladesh Bank instruction and BFIU master circular no. 10; branches have been instructed to
obtain full & accurate information of the clients while establishing banking relationship.
Actual transactions are compared with Transaction Profile (TP) to identify abnormal and suspicious
transaction(s).
Branch incumbents are always responsible for ongoing monitoring of Account Transactions & matching
given data with the transactions or activity. Branches identified Suspicious Transaction by transaction
symptoms & generate STR and send to CCU-AML, Head Office. After investigate & evaluate then sends
Suspicious Transaction Report (STR) directly to BFIU of Bangladesh Bank using goAML web software and
manually as per article 7 of BFIU master circular 10 & Bangladesh Banks Instruction within short time.
Branch generates monthly Cash Transaction Report (CTR) for threshold amount Tk. 10 lacs & above both
for FIU Software & goAML Software filing up the mandatory fields within given deadline. Central Compliance
Unit on verification & compilation sends XmL Cash Transaction Report (CTR) directly to BFIU of Bangladesh
Bank using goAML web software and CD as per article 6 of BFIU master circular 10 & Bangladesh Banks
Instruction.
In accordance with the instructions of BFIU, Banks provide the information of customer account within the
mentioned time limit in the issued letter. If any account / amount are freeze bank confirms the same
immediately to BFIU.
Customers are graded on the basis of risk. High risk customers are closely monitored and Enhanced Due
Diligence is applied in this case.
Self Assessment is done by the branches and a summary report is prepared and submitted to the
Management and Bangladesh Bank half yearly basis.
Independent Testing Procedure is done while conducting audit in the branches. The same is summarized
and placed before the Management and Bangladesh Bank half yearly basis."
As per article 3.2, 3.7, 3.8 & 3.9 of Bangladesh Bank's BFIU Circular No. 10, dated 28 December 2014,
branches have been instructed to apply Enhance Due Diligence (EDD) in opening & maintaining accounts of
Politically Exposed Persons (PEPs), Influential Persons (IPs), their family members and close associates.
Apart from Independent Testing Procedures, 50 branches have been inspected in the year 2014 on money
laundering prevention and combating financing terrorism.
Up to the year 2014 total 29 circulars of former Anti-Money Laundering Department and 10 circulars of
present Bangladesh Financial Intelligent Unit (BFIU) of Bangladesh Bank have been disseminated to
Bangladeshi all schedule banks for compliance.
Recently BFIU of Bangladesh Bank issued BFIU Circular No.10; Dated 28 December 2014 lifted Master
Circular. Total AMLD & BFIU Circular {except AML Circular No.10, (Cash Transaction Reporting form), AML
Circular No. 22, BFIU Circular No.02, BFIU Circular No.07 & BFIU Circular letter-1} are compiled &
accumulated making BFIU master circular no. 10 for all schedule Banks. Central Compliance Unit
(CCU-AML) of Head Office has disseminated the same through by instruction circular to the branches for
compliance.
Quarterly meeting of Central Compliance Unit (CCU) and Monthly meeting of Branch Compliance Unit (BCU)
are arranged and the decisions are gradually implemented.
Before establishing correspondent banking relationship, status on money laundering prevention and
combating financing terrorism of the respondent banks are obtained through a questionnaire developed by
Bangladesh Bank. Correspondent banking relationships with any bank is established upon receipt of the
desired information and subject to our satisfaction pursue by article 3.10 of BFIU master circular no 10.
As a precautionary measure and as per instruction of Central Bank, we do not establish Correspondent
Banking relationship with any shell bank or any bank having banking relationship with any shell bank.
Screening Mechanism is strictly followed for every customer and especially any foreign transactions like
import, export, foreign remittance, foreign guarantee & correspondent banking relationship through System
software procured by the bank.
Records of Accounts, supporting documents, Transactions, Instruments /vouchers & records of Walk in
Customers are maintained for all operating accounts & above documents are always maintained at least for
5 (five) years after closes of the account.
Operational loss may arise from error and fraud due to lack of internal control and compliance. Management through
internal control and compliance Division controls operational procedure of the Bank. Internal control and compliance
division undertakes periodical and special audit of the branches and departments at Head Office for review of the
operation and compliance of statutory requirement. The Audit Committee of the Board subsequently reviews the
reports of the internal control and compliance division.
NCCBL follows the guideline stated in BRPD Circular no. 14 dated 23 October 2005 regarding Guideline on
Information and Communication Technology for Scheduled Banks.
IT management deals with IT policy documentation, internal IT audit, training and insurance.
IT operation management covers the dynamics of technology operation management including change
management, assets management and operating environment procedures management. The objective is to achieve
the highest levels of technology service quality by minimum operational risk.
Physical security involves providing environmental safeguards as well as controlling physical access to equipment
and data.
a) Password
b) User ID maintenance
c) Input
d) Network security
e) Data encryption
f) Virus protection
g) Internet and e-mail
The Business Control Plan (BCP) is formulated to cover operational risk and taking into account the potential for
wide area disasters, data center disasters and the recovery plan. The BCP takes into account the backup and
recovery process.
Interest rate risk may arise either from trading portfolio and non-trading portfolio. The trading portfolio of the Bank
consists of Government treasury bills of 28 days maturity. The short-term movement in interest rate is negligible or
nil. Interest rate risk of non-trading business arises from mismatches between the future yield of an asset and its
funding cost. Asset liability Committee (ALCO) monitors the interest rate movement on a regular basis.
Equity risk
Equity risk arises from movement in market value of equities held. The market value of equities is lesser than cost
price against which provision is appearing made in these financial statements.
Money laundering risk is defined as the loss of reputation and expenses incurred as penalty for being negligent in
prevention of money laundering. For mitigating the risks, the bank has a designated Chief Compliance officer at Head
office and Compliance officers at branches, who independently review the transactions of the accounts to verify
suspicious transactions. Manuals for prevention of money laundering have been established and transaction profile
has been introduced. Training is continuously given to all the category of Officers and Executives for developing
awareness and skill for identifying suspicious activities / transactions.
Operational risk may arise from error and fraud due to lack of internal control and compliance. Management through
internal control and compliance division controls operational procedure of the Bank. Internal Control and compliance
division undertakes periodical and special audit of the branches and departments at the Head Office for review of the
operation and compliance of statutory requirements. The Audit Committee of the Board subsequently reviews the
reports of the internal control and compliance division.
Basic earnings per share have been calculated in accordance with BAS-33 Earnings per Share which has been
shown on the face of the profit and loss account. This has been calculated by dividing the basic earning by the
weighted average number of ordinary shares outstanding during the period.
No diluted earning per share is required to be calculated for the period as there was no scope for dilution during the
year under review.
Memorandum items are maintained to have control over all items of importance and for such transactions where the
Bank has only a business responsibility and no legal commitment. Stock of Travelers Cheques (TC), Saving
Certificates and other fall under the memorandum items.
2.23 Compliance of Bangladesh Accounting Standards (BAS) and Bangladesh Financial Reporting Standards (BFRS):
The Institute of Chartered Accountants of Bangladesh (ICAB) is the Official Standard setting body as well as the
regulator of accounting profession in the country. ICAB has adopted most of the International Accounting Standards
(IASs) and International Financial Reporting Standards (IFRSs) as Bangladesh Accounting Standards (BASs) and
Bangladesh Financial Reporting Standards (BFRSs). While preparing the financial statements, NCC Bank has applied
all the applicable of BASs & BFRSs for preparation and presentation of financial statements except described in note
no.2.1 as noted below:
* The above BAS and BFRS are not applied due to compliance of the Banking Companies Act 1991, Rules and
regulations and instructions issued by Bangladesh Bank time to time.
The Bank complied with the requirements of following regulatory and legal authorities:
Business Segments
Business segments report consists of products and services whose risks and returns are different from those of other
business segments. These segments comprise conventional Banking including Offshore Banking Unit, Investment
Services (NCCBSFSL & NCCBCL) and Remittance (NCCB Exchange (UK) Limited. Business segment report shown in
Annexure-M
Geographical segments
Geographical segments report consists of products and services within a particular economic environment where risk
and returns are different from those of other economic environments. These segments comprise of NCC Bank Limited,
Offshore Banking Unit, NCCB Securities and Financial Services Limited, NCCB Capital Limited & NCCB Exchange (UK)
Limited. Geographical segments reports are shown in Annexure-M.
Inter segment transactions generally based on inter branch fund transfer measures as determined by the
management. Income, expenses, assets, liabilities are specifically identified with individual segments. Based on such
allocation segment balance sheet as on 31 December 2014 and segment profit and loss account for the year ended 31
December 2014 have been prepared.
Events after the balance sheet date that provide additional information about the banks position at the balance sheet
date are reflected in the financial statements. Events after the balance sheet date are not adjusting event are disclosed
in the notes when material.
The bank has secured liability as mentioned in notes 12.03 and there was assets pledge as securities against
liabilities.
Last seven years Credit Ratings of our Bank are given below:
Year Date of Rating Long term Short Term Rating conducted by
2013 30.06.2014 AA AR-2 Alpha Credit Rating Limited
2012 30.06.2013 AA- AR-2 Alpha Credit Rating Limited
2011 24.05.2012 AA3 ST-2 Credit Rating Agency of
2010 23.06.2011 A1 ST-2 Bangladesh Limited (CRAB)
2009 24.06.2010 A1 ST-2
2008 29.06.2009 A2 ST-2
2007 09.06.2008 A2 ST-3
The BASEL Committee on Banking Supervision has published a new framework for calculating minimum capital
requirement, known as Basel II. The new guideline is structured around three pillars: (i) minimum capital
requirement (on credit risk, market risk and operation risk), (ii) supervisory review process and (iii) market discipline.
Implementation of Basel II framework in Bangladesh will integrate the risk management process of the Bank and its
capital adequacy requirement. Bangladesh Bank has formed a National Steering Committee and Coordination
Committee for implementation of BASEL II in Bangladesh. As per the Committee decision BASEL II has been fully
implemented in Bangladesh from January 2011. The National Steering Committee has indicated that following
methodology of BASEL II would be followed in Bangladesh:
a) Internal Control
The objective of internal control is to ensure that management has reasonable assurance that (a) operations are
effective, efficient and aligned with strategy, (b) financial reporting and management information is reliable, complete
and timely accessible, (c) the entity is in compliance with applicable laws and regulations as well as its internal
policies and ethical values including sustainability, and (d) assets of the company are safeguarded and frauds & errors
are prevented or detected.
National Credit and Commerce Bank Limited has established an effective internal control system whose primary aim
is to ensure the overall control of risks and provide reasonable assurance that the objectives set by the bank will be
met. It has designed to develop a high level risk culture among the personnel of the bank, establish efficient and
qualified operating model of the bank, ensure reliability of internal and external information including accounting and
financial information, secure the Banks operations and assets, and comply with laws, regulatory requirements and
internal policies.
b) Internal Audit
Internal Audit is the continuous and systematic process of examining and reporting on the activities of an organization
undertaken by the specially assigned staff(s). Internal Auditor works as the Eyes & Ears of the management. It may
therefore be used to bridge the gap between management and shop floor. It can assure the management that the
internal controls are adequate and in operations, the policies and systems laid down are being adhered to and
accounting records provided by the lower level are correct.
Internal Audit Mechanism is used as an important element to ensure good governance of NCC Bank Limited. Internal
Audit Activity of NCC Bank Limited is effective and it provides senior management with a number of important
services. These include detecting and preventing fraud, testing internal control, and monitoring compliance with own
policies & procedures, applicable rules & regulations, instructions/guidelines of regulatory authority etc.
During the period 2014, ICCD conducted inspection on many of the Branches/Divisions of Head Office of the Bank and
submitted reports presenting the findings of the audits/inspections. Necessary control measures and corrective
actions have been discussed in the meetings of the Audit Committee of the Board and necessary steps have been
taken according to the decision of the Committee for correct functioning of Internal Controls & Compliance.
The increasing wave of fraud and forgery cases in the banking sector in recent time calls for concerted steps in
identifying ways for reducing or preventing frauds and forgeries by analyzing the causes and effect of frauds and
forgeries, and prescribing effective control strategies for salvaging frauds in the banking sector. NCC Bank does
always pay due attention on anti-fraud internal controls for prevention of fraud and forgery. The Bank has already
implemented some strategies like Financial Control Strategy, Personnel Control Strategy, Accounting Control
Strategy, Credit Control Strategy, Cost Control Strategy, Administrative Control Strategy, Process Control Strategy
etc. in order to strengthening the control system further. Although it is not possible to eliminate all frauds because of
the inherent limitations of Internal Control System, the Board of Directors and management have taken all the
measures to keep the operational risk in a very minimum level. Internal Control and Compliance Division (ICCD)
assesses and evaluates the effectiveness of Banks anti-fraud internal control measures, recommends for further
improvement in implementation of aforesaid strategies and reports to the Bangladesh Bank of effectiveness of
controls at the end of each quarter following their prescribed format. During the year 2014, 2 (Two) instances of
frauds were identified and reported to Bangladesh Bank. Total amount related to those frauds is Taka 109.91 lac
(approx.) against which adequate provision has been maintained in the books of accounts. Management is exerting
their all out efforts to recover the aforesaid amount.
2.32 In the year 2013, Off-shore Banking unit was not incorporated in the financial statements due to an error. In the year
2014, the error was identified and it was incorporated in the financial statements. In order to comply with Bangladesh
Accounting Standard (BAS)-8 "Accounting Policies, Changes in Accounting Estimates and Errors", it requires to
restate the following items and to incorporate these in the financial statements:
Outside Bangladesh
Balance stated in Previous year 1,939,394,484 343,628,415 228,413,428
Adjustment for overstated of balance in Habib Metropolitan Bank - (14,890,342) -
Restated balance of 2013 for comparison as on 31.12.2014 1,939,394,484 328,738,073 228,413,428
2,407,581,410 656,757,606 1,316,317,832
In Bangladesh
NCC Bank Limited 468,186,926 328,019,533 1,087,904,404
NCCB Securities and Financial Services Limited 9,444,174 13,969,580 923,956
NCCB Capital Limited 271,032,940 271,044,320 257,006,262
NCCB Exchange (UK) Limited - - -
748,664,040 613,033,433 1,345,834,622
Less: Intercompany transactions
Balance stated in Previous year 277,130,441 271,044,320 257,006,262
Adjustment - 301,643 -
Restated balance of 2013 for comparison as on 31.12.2014 277,130,441 271,345,963 257,006,262
Restated balance of 2013 for comparison as on 31.12.2014 471,533,599 341,687,470 1,088,828,360
Outside Bangladesh
Outside Bangladesh
Balance stated in Previous year 431,910,475 63,433,308 104,423,929
Adjustment for Off-shore banking unit - 20,696,500 -
Restated balance of 2013 for comparison as on 31.12.2014 431,910,475 84,129,808 104,423,929
Restated balance of 2013 for comparison as on 31.12.2014 90,920,772,028 88,167,205,831 79,948,220,174
Other assets 11
Statutory reserve 16
Interest income 22
Other expenses 36
3 Audit committee
The Audit committee of the Board of Directors of the Bank formed in accordance with Bangladesh Banks BRPD circular No. 11
dated 27 October 2013 and SEC Notification no. SEC/CMRRCD/2006-158/129/Admin/44 dated August 7, 2012 on corporate
Governance, the current committee is constituted with the following members of the Board as on 31 December 2014:
During the period, the Audit committee of the Board conducted 17 (Seventeen) meetings in which the important issues were
discussed/reviewed. (Refer to the report of the Board Audit committee for details).
4 General
4.1 Number of employees
Number of employees at December 31, 2014 was 2266; (2013:2192) who were in receipt of remuneration for that year which
in the aggregate was not less than Tk. 36,000 per annum and those employed for a part of that year who were also in receipt
of remuneration of not less than Tk.3,000 per Month.
4.2 Figures appearing in these Financial Statements have been rounded off to the nearest Taka.
Previous years figures, whenever considered necessary, have been rearranged and restated in order to conform to current
years presentation.
Stock of Travelers Cheques, Shanchaya patras are not reflected as Off-balance Sheet items in the Financial Statements.
Conventional banking
Local currency 7,044,521,827 6,203,540,036
Foreign currencies 136,572,051 229,620,281
7,181,093,878 6,433,160,317
Sonali Bank Ltd. as agent of Bangladesh Bank ( Local Currency )-note 5.1 257,582,948 185,624,452
7,438,676,826 6,618,784,769
Off-shore banking unit - -
7,438,676,826 6,618,784,769
8,612,160,908 7,875,262,621
5.1 Sonali Bank Ltd. as agent of Bangladesh Bank ( Local Currency )
Cox's bazar branch 19,999,018 11,721,317
Feni branch 27,084,519 41,919,351
Laxmipur branch 23,019,074 18,276,848
Moulvibazar branch 7,932,546 7,630,611
Jessore branch 647,363 25,182,846
Chaumuhani branch 121,334 1,159,369
Madaripur branch 6,529,721 319,285
Chakaria branch 1,948,378 1,368,419
Comilla branch 1,127,549 7,241,496
Joydevpur branch 80,841 463,866
Mymensingh branch 47,331,431 22,904,061
Tangail branch 36,692,445 3,691,803
Naogaon branch 13,753,606 5,926,839
Kushtia branch 10,225,381 6,351,906
Narayangonj branch 2,404,313 1,715,327
Brahmanbaria branch 20,391,300 18,047,431
Narsingdi branch 13,543,097 4,853,378
Maijdee branch 1,683,444 755,275
Dinajpur branch 23,067,588 6,095,024
257,582,948 185,624,452
5.2 Cash Reserve Requirement (CRR) and Statutory Liquidity Ratio (SLR)
Cash Reserve Requirement (CRR) and Statutory Liquidity Ratio (SLR) have been calculated and maintained in
accordance with the Section 33 of the Banking Companies Act 1991, DOS circular no.01 dated 19 January 2014 and
MPD circular no. 01 dated 23 June 2014. The cash reserve requirement of the Bank's based on time and demand
liabilities @ of 6.50% has been calculated and maintained with Bangladesh Bank in current account and 13%
Statutory Liquidity ratio on same liabilities has also been maintained in the form of treasury bills, treasury bonds and
debenture including FC balance with Bangladesh Bank. Both the reserves maintained by the Bank are in excess of the
statutory requirements as shown below:
The Cash Reserve Requirement and Statutory Liquidity Ratio have been calculated and maintained for the year
2013 in accordance with the Section 33 of the Bank Companies Act 1991 and MPD circular nos.05 dated
01 December 2010.
Cash in hand
In Bangladesh
8 Investments :
Government securities-Note 8.1 25,241,572,158 18,352,194,148
Other investments-Note 8.2 1,327,089,604 1,556,127,854
26,568,661,762 19,908,322,002
8.1 Government securities:
Conventional banking
Treasury bills:
91 days treasury bills 1,209,850,791 -
182 days treasury bills 606,772,726 -
364 days treasury bills 323,101,883 -
2,139,725,400 -
Bangladesh Bank Bill - 467,254,260
Treasury bonds:
Conventional banking:
8 (a )Consolidated investments
Government securities
NCC Bank Limited- Note-8.1 25,241,572,158 18,352,194,148
NCCB Securities and Financial Services Limited - -
NCCB Capital Limited - -
NCCB Exchange (UK) Limited - -
25,241,572,158 18,352,194,148
Other investments
NCC Bank Limited-Note-8.2 1,327,089,604 1,556,127,854
NCCB Securities and Financial Services Limited 28,843,298 25,477,395
NCCB Capital Limited - -
NCCB Exchange (UK) Limited - -
1,355,932,902 1,581,605,249
26,597,505,060 19,933,799,397
9 Loans and Advances
Loans, Cash Credits, Overdrafts etc.(Note-9.1) 88,739,476,147 86,363,661,614
Bills Purchased and Discounted (Note-9.2) 2,181,295,881 1,803,544,217
90,920,772,028 88,167,205,831
9.1 Loans, cash credits, overdrafts etc.
Inside Bangladesh:
Conventional banking:
Overdraft 16,856,594,303 15,507,242,389
Cash credit 16,143,152,430 16,225,773,050
Loan - general 2,168,759,274 3,060,800,708
Transport loan 319,361,289 366,707,965
House building loan 1,395,715,516 1,471,559,673
Loan against Trust Receipt (LTR) 13,926,443,337 16,081,812,358
Loan against Imported Merchandise (LIM) 149,735,453 100,004,676
Loan against Investment 430 430
Loan against packing credit 139,474,580 153,443,756
Project loan 159,115,208 184,646,908
Demand loan 193,648,228 10
Lease finance 1,332,835,683 1,259,195,964
Payment against document 503,349,142 477,250,080
Consumer finance scheme 586,100 614,456
Housing loan under B.Bank refinance scheme 25,162,991 31,747,840
Staff loan 657,849,422 707,992,809
Small business loan 786,459,743 787,702,881
In Bangladesh:
Loans 55,739,729,414 54,630,646,175
Cash credit 16,143,152,430 16,225,773,050
Overdraft 16,856,594,303 15,507,242,389
Bills Purchased & Discounted 1,749,385,406 1,719,414,409
90,488,861,553 88,083,076,023
Outside Bangladesh (Bills purchased & discounted) 431,910,475 84,129,808
90,920,772,028 88,167,205,831
9.6 Loans and advances on the basis of significant concentration
including bills purchased and discounted classified into the
following broad categories:
II) Advances to Chief Executive and other Senior executives of the Bank
21,201,738 19,035,000
III) Advances to customers' group-wise clients
a) Agricultural loans 1,311,652,055 1,737,300,456
b) Export financing 4,584,323,900 3,985,211,487
c) Import financing 18,966,108,325 21,804,030,706
d) Transport and communication 960,070,757 1,434,600,042
a) Commercial lending 15,370,903,296 15,762,102,080
c) House building loan 4,950,886,449 7,658,020,309
f) Staff Loans other than Chief executive and other senior executives 657,849,422 688,958,281
g) Others including bills purchased and discount 12,248,697,477 8,833,032,687
59,050,491,681 61,903,256,048
IV) Industrial loans (including working capital) 31,713,305,609 26,084,706,552
90,920,772,028 88,167,205,831
x) Amount of classified loans for which interest/profit not credited to income 6,735,516,359 4,862,413,739
xii) Amount of written off debt against which law suit has
been filed for its recovery during the year 997,786,941 204,859,925
Bangladesh Bank issued a circular no.02 dated 13 January 2003 instructing all the banks in the country to write off
bad & loss loans which have passed five years after its classification and legal actions have been taken against all
those default borrowers with an immediate effect. In compliance with the circular, the Bank formed a Debt Collection
Unit in its Head Office from where monitoring has been made accordingly. During the year, the Bank allowed write off
amounting to Tk.99,77,86,941/- against which legal actions have been lying with the money suit court. In this
connection, branches have been maintained a separate ledger for all individual cases. The debt collection unit will
follow-up the realization of such debts in future also and time to time a progress report to be given to the management
by the branches.
a) Payable:
In Bangladesh 1,749,385,406 1,719,414,409
Outside Bangladesh 431,910,475 84,129,808
2,181,295,881 1,803,544,217
b) Bills purchased & discounted on the basis of the residual maturity grouping:
Payable:
Within one month 572,113,821 431,180,791
Over one month but less than three months 513,501,843 659,640,000
Over three months but less than six months 303,678,000 691,232,926
Over six months 792,002,217 21,490,500
2,181,295,881 1,803,544,217
9(a) Consolidated loans and advances
Loans, cash credits, overdrafts etc.
NCC Bank Limited (Note-9.1) 88,739,476,147 86,363,661,614
NCCB Securities and Financial Services Limited. 4,607,372,304 4,514,072,239
NCCB Capital Limited - -
NCCB Exchange (UK) Limited - -
93,346,848,451 90,877,733,853
Less : Inter company transactions 1,761,631,457 1,890,840,821
91,585,216,994 88,986,893,032
2014 2013
Taka Taka
Range of holding of shares No. of share holders % of shares holding No. of shares
Less than 5,000 78,651 10.42 83,627,600
5,001 to 10,000 5,468 4.75 38,133,165
10,001 to 20,000 2,473 4.25 34,143,886
20,001 to 30,000 702 2.12 16,988,079
30,001 to 40,000 310 1.33 10,716,394
40,001 to 50,000 188 1.06 8,530,358
50,001 to 100,000 394 3.43 27,557,688
100,001 to 200,000 197 3.34 26,838,025
200,001 to 300,000 60 1.88 15,073,822
300,001 to 400,000 46 1.96 15,726,626
400,001 to 500,000 22 1.23 9,844,922
500,001 to 1,000,000 40 3.68 29,569,777
1,000,001 to 10,000,000 75 27.01 216,865,545
10,000,001 to 100,000,000 17 33.54 269,309,571
Total 88,643 100.00 802,925,458
2014 2013
Taka Taka
15.6 Capital Adequacy Ratio (CAR) (Solo Basis)
2014 2013
16 Statutory reserve Taka Taka
Opening balance on 1 January 4,283,417,675 3,818,042,032
Addition during the year (20% of pre-tax profit) 500,095,692 465,375,643
Closing balance at 31 December 4,783,513,367 4,283,417,675
17 General reserve
Opening balance on 1 January 10,162,348 10,162,348
Addition during the year - -
Less : Adjusted during the year - -
Closing balance at 31 December 10,162,348 10,162,348
18 Other reserves
18.1 Assets revaluation reserve on land and building
Opening balance 464,950,159 467,162,980
Less : Provision for deferred tax 18,286,545 14,014,889
446,663,614 453,148,091
Less: Depreciation on revalued amount transferred to retained earnings 3,514,878 6,484,477
443,148,736 446,663,614
Add: Reverse deferred tax on revaluation on land - -
443,148,736 446,663,614
Add: Addition during the year - -
443,148,736 446,663,614
18.2 Revaluation reserve on Govt. securities (treasury bills & bonds)-HTM
Opening balance 4,097,898 16,581,364
Add: addition during the year 161,515,485 1,874,937
Held to maturity (HTM ) 8,007,887 -
Held for trading (HFT) 151,156,851 -
Treasury bond (RM) 2,350,747 1,874,937
Less: adjusted during the year (123,899,800) (14,358,403)
Held to maturity (HTM ) - -
Held for trading (HFT) (123,899,800) (14,358,403)
Closing balance 41,713,583 4,097,898
484,862,319 450,761,512
18.3 Foreign currency translation gain/(Loss)
Opening balance 2,518 -
Add: Transfer during the year (279,155) 2,518
Closing balance (276,637) 2,518
Retained earnings brought forward from previous year ( Note-19.1 ) 37,425,151 199,626,621
Profit for the year 1,501,329,218 1,137,847,175
Transfer to statutory reserve (500,095,692) (465,375,643)
Transferred to general reserve - -
Transferred from general reserve - -
1,038,658,677 872,098,153
Depreciation on revalued amount of building Trans. to retained earnings 3,514,878 6,484,477
1,042,173,555 878,582,630
19(a) Consolidated surplus in profit and loss account
22 Interest income
Conventional banking (Note-22.1) 12,016,454,445 12,193,950,023
Off-shore banking unit (Note-22.2) 10,555,063 320,301
12,027,009,508 12,194,270,324
Less: intertransaction between OBU and conventional banking 7,225,340 171,852
12,019,784,168 12,194,098,472
22.1 Conventional banking
Interest on loans and advances
Loan ( General) 252,224,902 493,236,786
Loan against house building 178,797,672 219,513,219
Loan against imported merchandise 14,095,975 19,629,038
Loan against trust receipts 2,098,168,575 2,554,304,545
Loan against packing credit 11,443,599 12,709,040
Demand Loan 27,851,625 -
SOD against financial obligation 821,895,586 806,944,949
SOD against real estate - 60,819
SOD general 1,360,733,710 1,354,873,894
SOD export 30,029,817 46,185,863
Discount -EDF 525,374 -
C.C. against pledge 12,118,879 11,959,387
C.C. against hypothecation 2,315,661,988 2,288,236,647
C.C. against export 1,334,050 665,510
Forced loan 367,539,007 265,958,852
Inland bill purchased 6,625,944 2,070,403
FDBP & discounted 6,065,590 8,869,972
Payment against documents 72,387,544 125,991,286
Local documentary bills purchased 247,625,209 270,648,034
Transport loan 40,271,219 54,702,346
Project loan - 6,256,943
Lease finance 211,646,902 224,786,183
* Incentive bonus disbursed for 2014 included Tk.10,00,000/- in favour to our Ex-Managing Director & CEO.
Earnings per share have been calculated in accordance with BAS-33 "Earnings per share". Previous year's figures
have been adjusted for the issue of bonus shares during the year.
The Board of Directors in its 316th meeting held on 06 May 2015 approved the financial statements and also
authorized the same for public issue. The Board also decided to recommend payment of 10% (ten percent) stock
dividend for the year 2014 for approval by the shareholders in the next ensuing Annual General Meeting (AGM).
There are no other material events for disclosure.
INVESTMENT IN SHARES
As on 31 December 2014
Un-Quoted
Total market value of shares is lesser than cost price by Tk.495,377,836/- against which provision of Tk.495,377,836/-
is appearing in these financial statements.
2014 2013
Sl. Outstanding Total Total
No Name of Clients
Non-Funded Amount Amount
Funded
1 Abul Khair Steel Industries Ltd. 133.15 193.33 326.48 334.01
2 NCCB Securities & Financial Services Limited 176.07 52.00 228.07 241.17
3 Meghna Group - - - 139.69
4 Ziri Subader Steel Re-Rolling Mills 44.56 139.94 184.50 221.81
5 Saad Musa Home Tex & Clothing Ltd. 145.43 66.17 211.60 231.07
6 Partex Group 190.22 32.43 222.65 217.39
7 BSRM Steel 136.38 113.21 249.59 160.59
8 Deshbandhu Sugar Mills Ltd. - - - 211.88
9 Metro Group (Best Holdings Ltd.) 159.02 - 159.02 -
10 Max Pre-Stress & Max Automobiles Ltd. 100.13 98.48 198.61 -
11 Kabir Steel Re-Rolling Mills Ltd. 115.72 128.87 244.59 -
12 DAF P.P. Ind. & allied concern 141.28 30.87 172.15 -
13 Doreen Power Generation & Systems Ltd. 166.41 260.07 426.48 -
Grand -Total 1,508.37 1,115.37 2,623.74 1,757.61
158
Building (Head Office premise on Land - 1) - 570,124,689 570,124,689 - - - - 570,124,689
Land - I - Head Office Premise 95,284,000 - - 95,284,000 - - - - 95,284,000
Land - II - Head Office Premise (with Structure) 24,709,834 - - 24,709,834 273,322 50,355 - 323,677 24,386,157
Land - III Premise of Dhanmondi Branch 26,699,950 - - 26,699,950 4,063,690 549,107 - 4,612,797 22,087,153
Land - IV Premise of Islampur Branch 47,812,834 - - 47,812,834 5,082,056 1,055,769 - 6,137,825 41,675,009
Land -V - Premise of Savar Branch 26,021,474 - - 26,021,474 2,831,938 521,738 - 3,353,676 22,667,798
Land - V1 - Premise of Bijoynagar Branch 53,085,456 - - 53,085,456 6,247,256 1,150,955 - 7,398,211 45,687,245
Land - V11 - Premise of Pragoti Sarani Branch 62,115,010 - - 62,115,010 5,351,497 1,419,088 - 6,770,585 55,344,425
Land - V111 - Premise of Uttara Branch 70,347,200 - - 70,347,200 5,324,080 1,625,578 - 6,949,658 63,397,542
Land - 1X -Premise of Agrabad Branch 60,682,473 - - 60,682,473 4,499,933 1,404,564 - 5,904,497 54,777,976
Land - X -Premise of Elephant Road Branch 87,386,268 - - 87,386,268 6,257,146 1,978,603 - 8,235,749 79,150,519
Land-XI- Premise of Mitford Branch 30,004,115 - - 30,004,115 1,540,987 543,078 - 2,084,065 27,920,050
Land-XI1- Premise of O. R. Nizam Road Branch 136,811,525 - - 136,811,525 7,133,737 3,214,445 - 10,348,182 126,463,343
Vehicles 95,750,888 9,147,542 (6,753,714) 98,144,716 61,239,759 13,976,316 (6,753,710) 68,462,365 29,682,351
Sub-total 1,956,087,461 988,389,851 (20,446,890) 2,924,030,422 680,127,975 143,794,756 (15,980,796) 807,941,935 2,116,088,487
Re-valuation Depreciation
Land -I -Premise of Head Office 79,816,000 - - 79,816,000 - - - - 79,816,000
Land - II - Head Office Premise (with Structure) 240,267,348 - - 240,267,348 - - - - 240,267,348
Land - III Premise of Dhanmondi Branch 76,152,845 - - 76,152,845 4,711,309 1,786,038 - 6,497,347 69,655,498
Land - IV Premise of Islampur Branch 9,472,401 - - 9,472,401 236,811 230,890 - 467,701 9,004,700
Land - V Premise of Saver Branch 11,895,874 - - 11,895,874 297,396 289,962 - 587,358 11,308,516
Land - VI Premise of Bijoynagar Branch 46,893,792 - - 46,893,792 1,172,344 1,143,036 - 2,315,380 44,578,412
Land - VII Premise of Pragoti Sarani Branch 2,664,720 - - 2,664,720 66,624 64,952 - 131,576 2,533,144
Sub-total 467,162,980 - - 467,162,980 6,484,484 3,514,878 - 9,999,362 457,163,618
December -2014 Grand total 2,423,250,441 988,389,851 (20,446,890) 3,391,193,402 686,612,459 147,309,634 (15,980,796) 817,941,297 2,573,252,105
December -2013 2,297,730,438 149,337,917 (23,817,914) 2,423,250,441 554,145,004 150,964,056 (18,496,601) 686,612,459 1,736,637,982
Annexure-E
NCC Bank Limited
Borrowings from other banks, Financial Institutions and agents.
(Outside Bangladesh) - Note -12
As on 31 December 2014
2014 2013
Amount in Taka
Current Tax Tax Liability as Excess/ Advance
Accounting Assessment Provision as Dues/
per Assessment (Shortage) Income (Refund) Remarks
Year Year per accounts Order/Return provision Tax paid
160
Up to 2000 - 142,334,958 213,676,031 (71,341,073) 215,471,134 (1,795,103) Assessment Completed
2001 2002-2003 119,081,542 146,692,885 (27,611,343) 139,829,928 6,862,957 Appeal filed to High Court Division
2002 2003-2004 177,842,495 177,842,495 - 177,842,495 - Assessment Completed
2003 2004-2005 255,478,335 86,888,016 168,590,319 159,999,990 (73,111,977) Appeal filed to High Court Division
2004 2005-2006 221,398,901 222,971,622 (1,572,721) 226,708,126 (3,736,504) Assessment Completed
2005 2006-2007 322,779,734 322,779,734 - 322,779,734 - Assessment Completed
2006 2007-2008 574,346,529 571,482,877 2,863,652 550,272,141 21,210,736 Appeal filed to High Court Division
2007 2008-2009 658,972,487 765,003,802 (106,031,315) 742,491,423 22,512,379 Appeal filed to High Court Division
2008 2009-2010 886,681,988 842,159,000 44,522,988 830,142,418 12,016,582 Appeal filed to High Court Division
2009 2010-2011 780,131,543 834,509,903 (54,378,360) 815,665,866 18,844,037 Appeal filed to High Court Division
2010 2011-2012 1,082,996,677 1,335,142,229 (252,145,552) 11,94,651,851 140,490,378 Appeal filed to High Court Division
2011 2012-2012 1,423,823,445 1,529,029,990 (105,206,545) 1,396,639,461 132,390,529 Appeal pending with Commissioner of Taxes (Appeal)
2012 2013-2014 1,311,459,496 1,331,302,532 (19,843,036) 1,331,302,532 - Return filed u/s-82BB but assessment order yet to receive.
2013 2014-2015 1,204,981,256 1,063,429,734 141,551,522 1,063,429,734 - Return filed u/s-82BB but assessment order yet to receive.
2014 2015-2016 869,355,654 749,661,486 119,694,168 571,990,215 - Return to be filed on 15 July 2015.
Total 9,162,309,386 9,442,910,850 (160,907,296) 9,167,226,836 275,684,014
NCC Bank Limited Annexure-G
Notes to the Financial Statements
Status
Sl. Name of the firms/companies in which interested as proprietor, % of
Name of Directors with the
No partner, Director,managing agent, guarantor, employee etc. interest
NCCBL
1 Alhaj Md. Nurun Newaz Chairman
Royal International, Proprietor 100.00%
Electro Mart Limited, Chairman 17.50%
Trade International Marketing Ltd., Chairman 20.00%
Newaz International Ltd., Managing Director 35.00%
The Royal Bengal Agency, Proprietor 100.00%
Central Insurance Company Limited, Shareholder 5.00%
Electro Appliances Mfg.Industries Limited , Chairman 30.00%
2 Mr. A.S.M. Main Uddin Monem Vice Chairman Abdul Monem Limited, Director 15.00%
Abdul Monem Sugar Refinery Limited, Director 12.95%
Igloo Foods Limited, Director 15.38%
AM Securities & Financial Services Limited.,Managing Director 93.33%
AM Energy Limited, Director 15.00%
The Bank in normal course of business has had transactions with other entities that fall within the definition of Related party as contained in Bangladesh Accounting
Standards (BAS-24) (Related Party Disclosures) and as defined in the BRPD Circular # 14 dated 25 June 2003.
The Significant Related party transactions during the year were as follows: Figure in Lac
FINANCIAL STATEMENTS
for the year ended on 31 December 2014
Sl. Amount
Counter Party Name Agreement Date
No Reversal Date (1st leg cash consideration)
Sl. Amount
No Counter Party Name Agreement Date Reversal Date (1st leg cash consideration)
NIL
Total -
* Credit Deposit Ratio (CDR) calculation is made as per Bangladesh Bank guidelines.
FINANCIAL HIGHLIGHTS
For the year ended on 31 December 2014
* Credit Deposit Ratio (CDR) calculation is made as per Bangladesh Bank guidelines.
175
NCC Bank Limited Annexure-N
Cash - - - -
In hand (including foreign currencies) - - - -
Balance with Bangladesh Bank and its agent bank (s) - - - -
(including foreign currencies)
Balance with other banks and financial institutions 3 67,212 5,235,777 - -
In Bangladesh - - - -
Outside Bangladesh 67,212 5,235,777 - -
These financial statements should be read in conjunction with the annexed notes.
These financial statements should be read in conjunction with the annexed notes.
Off-shore Banking Unit (OBU) of NCCBL governed under rules and guidelines of Bangladesh Bank. The Bank
obtained permission from Bangladesh Bank for operating of Off-shore Banking units located at our Foreign
Exchange Branch & Agrabad Branch vide Bangladesh Bank Letter No. BRPD (P-3)744(113)/2010-1648 dated
02 May 2010. The Bank commenced the operation of its Off-shore Banking Units from 26 August 2013 at
Foreign Exchange Branch, Dhaka. Operation of OBU located at Agrabad Branch, Chittagong will be started
within very soon.
The principal activities of the OBU are to provide all kinds of commercial banking services to its customers
through its Off-shore Banking units in Bangladesh.
The off-shore banking Units maintain its accounting records in USD from which accounts are prepared
according to the Bank Companies Act-1991, Bangladesh Accounting Standards (BASs), Bangladesh Financial
Reporting Standards (BFRSs) Other laws and regulations applicable in Bangladesh and applicable directives
issued by Bangladesh Bank.
The preparation of financial statements requires management to make judgment, estimates and assumptions
that affect the application of accounting policies and the reported amounts of assets. Liabilities, income and
expenses. Actual expenses may differ from these estimates. The figure appearing in these financial statements
have been rounded off to the nearest integer.
Foreign currency transactions are converted in to equivalent Taka using the ruling exchange rates on the dates
of respective transactions as per BAS-21 "The effects of changes in Foreign Exchange Rates". Foreign currency
balances held in US Dollars are converted into Taka at weighted average rate of inter-bank market as determined
by Bangladesh Bank on the closing date of every month.
The resulting exchange transaction gains and losses are included in the profit and loss account.
Cash flow statement has been prepared in accordance with the BRPD circular no.14 dated 25 June 2003 issued
by the Banking Regulations and Policy Department of Bangladesh bank.
cash and cash equivalents include notes and coins on hand, unrestricted balances held with Bangladesh Bank
and highly liquid financial assets which are subject to insignificant risk to change in their fair value, and are used
by the unit management for its short-term commitments.
a) Loans and advances of off-shore banking units are stated in the balance sheet on gross basis.
b) Interest is calculated on a daily product basis but charged and accounted for on accrual basis. Interest is not
charged on bad and loss as per guidelines of Bangladesh. Records of such interest amounts are kept in separate
memorandum accounts.
A provision for recognized in the balance sheet when the unit has a legal or constructive obligation as a result
of a past event and it is probable that an out flow of economic benefit will be required to settle the obligations,
in accordance with the BAS 37 " Provisions, Contingent liabilities and Contingent Assets".
In terms of the provisions of the BAS-18 " Revenue", the interest income is recognized on accrual basis.
In terms of the provisions of the BAS-1 " Presentation of Financial Statements" interest and other expenses are
recognized on accrual basis.
2 General
a) These financial statements are presented in taka, which is the Bank's functional currency. Figure appearing
in these financial statements have been rounded off to the nearest Taka.
b) Assets and liabilities & Income and expenses have been converted into Taka currency closing rate as at
transaction date and average rate.
2014 2013
USD BDT USD BDT
In Bangladesh - - - -
Outside Bangladesh 67,212 5,235,777 - -
67,212 5,235,777 - -
4 Loans and Advances
Inside Bangladesh: - - - -
Outside Bangladesh: - - - -
- - - -
4.2 Bills purchased and discounted
Inside Bangladesh: - -
Outside Bangladesh: 4,700,422 370,745,781 265,000 20,696,500
4,700,422 370,745,781 265,000 20,696,500
6 Other assets
7 Borrowing from other banks, financial institutions and agents 4,858,461 383,332,567 265,000 20,693,982
9 Other liabilities
Provision for loans and advances (9.1) 47,004 3,707,458 2,650 206,965
Interest payable - - 2,228 171,852
47,004 3,707,458 4,878 378,817
9.1 Provision for loans and advances
Opening Balance 2,650 206,965 -
Provision for loans and advances charged during the year 44,354 3,500,493 2,650 206,965
Closing Balance 47,004 3,707,458 2,650 206,965
11 Contingent liabilities :
12 Interest income
17 Legal Expenses - - - -
20 Audit fees - - - -
21.2 Depreciation: - - - -
22 Other expenses - - - -
Dear Shareholders,
Assalamualaikum,
On behalf of the Board of Directors of NCCB Securities and Financial Services Ltd. I am immensely pleased to present before
you the Directors Report, Auditors Report and the Audited Financial Statements of the Company for the year ended on 31st
December, 2014 in the 5th Annual General Meeting for consideration, approval and adoption of our valuable shareholders.
But before that I would like to place a brief description of both Bangladesh and Global economic state during the year under
report for your reference.
Global Economy:
The World economy is still in the struggle to recover from economic downward trend as many advanced countries are trying
to cope with the aftermath of the global financial crisis. The recovery in developed nations has been uneven, as some
countries like the United States and United Kingdom have exceeded pre-crisis output peaks, but countries under the Euro
Zone are still below earlier peaks. Middle-income countries have also been less dynamic than in the past due to cyclical
reasons and to structural slowdown as well. Low-income countries continue to grow at a steady pace, despite a challenging
global environment. The World Bank has estimated that the growth in South Asia will rise at an estimated 5.5 percent in
2014 from a 10-year low of 4.9 percent in the previous year.
Bangladesh Economy:
Bangladesh has been experiencing steady economic growth over the years and could sustain an average GDP growth rate
of more than 6.0 percent despite global economic meltdown. During FY 2013-14 economic activity was disrupted by
political turmoil and uncertainty surfaced due to the general election of January 2014. However, macroeconomic stability
prevailed and foreign currency reserve buffers have been increased further. Gross Domestic Product (GDP) growth rate in
FY 2013-14 increased to 6.12 percent from 6.01 percent in FY 2012-13. Substantial remittance inflows and export activities
helped in achieving this solid economic growth rate. An impressive GDP growth rate of 6.5 percent for Bangladesh has been
projected by IMF in 2015, where the projection for Asia is 5.5 percent. Further, the Asian Development Bank (ADB) has also
projected a growth rate of 6.4 percent in FY 2014-15 for our country. In FY 2013-14, per capita GNI (gross national income)
at current market price of Bangladesh has been estimated to be about US$ 1190, against US$ 1054 for the preceding fiscal
year which was 12.9 percent. On the other hand, per capita GDP at current market price has also increased to US$ 1,115 in
FY 2013-14 from US$ 976 in FY 2012-13 showing US$ 139 increase or 14.2 percent growth.
At the end of FY 2012-13, foreign exchange reserve stood at US$ 15.32 billion, which was US$ 21.56 billion at the end of
FY 2013-14. Over the last few years, Bangladesh could maintain stable economic growth due to homebound remittance and
the remarkable growth of the hundred percent export-oriented readymade garments industry. Remittance inflows increased
four times in the last ten years. During FY 2012-13, remittance receipt was US$ 14.64 billion, which was US$ 14.23 billion
during FY 2013-14. Bangladesh has emphasized to improve the labor and capital efficiencies and increase investment rates,
to become a middle income country by 2021.
Appointment of Auditors:
The auditor of the Company M/S. Shafiq Mizan Rahman & Augustine will retire in this Annual General Meeting (AGM).Being
eligible for reappointment as auditor of the Company, the Board of Directors has been recommended for reappointment of
M/S. Shafiq Mizan Rahman & Augustine, Chartered Accountants as auditor of the company for the year 2015 at a
remuneration of Tk. 25,000/-(Twenty Five Thousand) only for the approval of the shareholders in the Companys 5th Annual
General Meeting (AGM).
Appreciation:
On behalf of the members of the Board of Directors of NCCB Securities and Financial Services Ltd. I take this opportunity to
record thanks and gratitude to the Govt. of the Peoples' Republic of Bangladesh, Bangladesh Securities and Exchange
Commission, Dhaka Stock Exchange Ltd, Chittagong Stock Exchange Ltd, different Government Agencies, Regulatory
Bodies, Shareholders, Patrons, Valued Clients for their continuous support, guidance and cooperation and look forwards to
their continued support and co operation in future.
The Board of Directors also records its thanks to the Management Team and all the employees of the NCCB Securities and
Financial Services Ltd for their dedicated services towards the growth of the institution.
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
Bangladesh Financial Reporting Standards (BFRS), the Companies Act, 1994, the Securities and Exchange Rules ,1987 and
other applicable laws and regulations and for such internal control as management determines is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditors Responsibility:
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in
accordance with Bangladesh Standards on Auditing (BSA).Those standards require that we comply with ethical requirements
and perform the audit to obtain reasonable assurance about whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entitys preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entitys internal control. An audit also includes evaluating the appropriateness of accounting policies used
and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the
financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion:
In our opinion, the financial statements give a true and fair view of the financial position of the Company as at 31 December
2014 and of its financial performance and its cash flows for the year then ended in accordance with the Bangladesh Financial
Reporting Standards (BFRS) and comply with the Companies Act, 1994, the Securities and Exchange Rules, 1987 and other
applicable laws and regulations.
a we have obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purpose of our audit and made due verification thereof;
b in our opinion, proper books of account as required by law have been kept by the Company so far as it appeared
from our examination of those books;
c the Companys financial statements dealt with by the report are in agreement with the books of account; and
d the expenditures incurred were for the purpose of the companys business:
2014 2013
Notes
Taka Taka
Assets
Non-Current Assets
These Financial Statements should be read in conjunction with the annexed notes from 1 to 32
Operating Revenue:
Brokerage Commission 18 102,173,092 102,914,461
Interest on Margin Loan 19 251,601,091 465,544,860
Other Operating revenue 20 3,412,269 4,773,187
357,186,451 573,232,508
These Financial Statements should be read in conjunction with the annexed notes from 1 to 32.
2014 2013
Notes
Taka Taka
NCCB Securities and Financial Services Limited (the "Company") has been incorporated as a private limited company with
the Registrar of Joint Stock Companies and Firms, Dhaka, Bangladesh bearing Registration No.C - 83683/10 dated April
04, 2010 under the Companies Act, 1994, registered office of the company situated at NCC Bank Bhaban (3rd Floor),13/1
& 13/2 Toyenbee Circular Road, Motijheel C/A, Dhaka-1000.
The Financial Statements have been Prepared on a going concern basis following accrual basis of accounting except for
statement of cash flows in accordance with the Company's Act 1994, Securities & Exchange Rules 1987, the listing Rules
of Dhaka & Chittagong Stock Exchanges and International Accounting Standards (IAS), International Financial Reporting
Standards (IFRS) as adopted in Bangladesh by the Institute of Chartered Accountants of Bangladesh as Bangladesh
Financial Reporting Standards (BFRS's) and other applicable laws & regulations.
The Financial Statements have been prepared based on historical cost convention basis. No adjustment has been made
for inflationary factors affecting the financial statements. The accounting policies, unless otherwise stated, have been
consistently applied by the Company and are consistent with those of the previous year.
These financial statements are prepared in Bangladesh Taka which is the Companys functional currency. All financial
information presented in Taka has been rounded to the nearest integer.
The preparation of Financial Statements requires management to make judgments, estimates and assumptions that affect
the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results
may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revision of accounting estimates are
recognized in the period in which the estimate is revised and in any future periods affected.
Revenue Recognition:
Income from brokerage commission is recognized on daily basis in the profit and loss account after receiving the trading
note of securities transacted from Dhaka Stock Exchange Limited & Chittagong Stock Exchange Limited, at which point
performance is assured to be completed.
Cash flow statement has been prepared as per Bangladesh Accounting Standard (BAS 7) Under Direct Method
Items of Property, Plant and Equipment are measured at cost less accumulated depreciation and impairment losses, if
any. Cost includes expenditures that are directly attributable to the acquisition of the asset.
Subsequent costs
The cost of replacing part of an item of Property, Plant and Equipment is recognized in the carrying amount of the item if
it is probable that the future economic benefits embodied within the part will flow to the Company and its cost can be
measured reliably. The costs of the day-to-day servicing of Property, Plant and Equipment are recognized in the profit and
loss account as incurred.
2.8 Intangibles
Computer software acquired by the Company, which have finite useful lives, are measured at cost less
accumulated amortization.
Intangible assets are amortized at the rate of 20% on the straight line method.
The Income Tax is assessed under section 82BB of the Income Tax Ordinance (ITO) 1984 on income from
company's normal course of business and at 35% on company's income from other sources. Under section 82C,
income tax deducted under certain sections of the ITO is treated as final discharge of tax payer's tax liabilities from
that source.
As per Bangladesh Accounting Standards (BAS) -24 " Related Party Disclosures " parties are considered to be
related if one of the parties has the ability to control the order party or exercise significant influence over the other
party in making financial and operational decisions. The Company carried out transactions in the ordinary course
of business on an arm's length basis at commercial rates with related parties.
The Board of Directors takes the responsibility for the preparation and presentation of these Financial Statements.
2.12 General
a) Prior years figures have been rearranged, where necessary to conform current years presentation.
b) The figures appearing in these Financial Statements are expressed in Taka currency and rounded off to the nearest Taka .
2014 2013
Taka Taka
3 Property, Plant & Equipment
The Dhaka Stock Exchange Ltd allotted 7,215,106 number of Ordinary shares of Tk 10 each against the
membership held with them as per approved scheme of Demutualization under the provision of Exchange
Demutualization Act, 2013 as under:
5.1 Investment in shares of Dhaka Stock Exchange Ltd:
Shares Allotted Face Value in Tk
40% Ordinary Shares i.e. 2,886,042 shares of Tk 10/- each credited to BO
A/C # 120209005087704 of NCCB Securities and Financial Services Ltd 28,860,420
60% Ordinary Shares i.e. 4,329,064 shares of Tk 10/- each credited to DSE 43,290,640
Demutualization Blocked account maintained by DSE.
72,151,060
The Chittagong Stock Exchange Ltd allotted 4,287,330 number of Ordinary shares of Tk 10 each against the
membership held with them as per approved scheme of Demutualization under the provision of Exchange Demutu-
alization Act, 2013 as under:
5.2 Investment in shares of Chittagong Stock Exchange Ltd:
Shares Allotted Face Value in Tk
40% Ordinary Share i.e. 1,714,932 shares of Tk 10/- each credited to BO
A/C # 120209005087704 of NCCB Securities and Financial Services Ltd. 17,149,320
60% Ordinary Share i.e. 2,572,398 shares of Tk 10/- each credited to CSE 25,723,980
Demutualization Blocked account maintained by CSE.
42,873,300
7 Accounts Receivable
Receivable from Dhaka Stock Exchange Limited 2,714,157 1,716,076
Receivable from Chittagong Stock Exchange Limited 8,882,505 5,966,612
Receivable against shares - 57,945
Interest Receivable on Margin Loan 13,847 13,847
11,610,509 7,754,479
8 Advance, Deposit and Prepayments:
Suspense Account-Sundry Debtors 40,500 12,500
Advance Against Office Rent 4,989,930 -
5,030,430 12,500
9 Advance Income Tax
The Issued ,Subscribed and Paid up Capital is Tk 2,000,000,000.00 divided into 20,000,000 ordinary shares
of Tk 100 each fully paid. The shareholding position of the Company as on December 31,2014 was as follows:
13 Retained Earnings
As complied with BSEC Circular no. SEC/mukhpatra/2011/696 dated on 19 February 2013, has been provided
provision against equity erosion of Margin Loan A/C's for Tk 10,000,000.00 from the current year profit and
accumulated balance thereby stood at Tk 168,825,296.00 as on December 31, 2014. Moreover, Interest
Suspense has been buildup for Tk 616,684,820.00 against Margin Loan facility till 31 December, 2014 as well.
Interest receivable has also been kept in separate A/C namely 'Memorandum register' for Tk 501,866,778.85
on classified Margin Loan.
Cost Depreciation
Written Down
Disposal/ Disposal/
adjustment Rate of Balance as Balance as at Value (WDV)
Particulars Balance as Addition Balance as at Charged for adjustment
Depreciation 1st January 31 December as at
1st January During during 31 December during the Year
2014 the Year 2014 31 December 2014
2014 the Year the Year 2014
Computer & Peripherals 14,480,303 135,500 - 14,615,803 20% 7,027,375 2,345,693 - 9,373,068 5,242,735
198
Total 34,738,818 1,508,981 51,797 36,196,002 15,888,983 3,716,668 - 19,605,651 16,590,351
Accounting Assessment Provision for Advance Income Tax Liability as (Short)/Excess Remarks
Year Year Income Tax Tax Paid per Return
1 2 3 4 5 6=(3-5) 7
2011 2012-2013 84,544,924 69,966,727 69,966,727 14,578,197 Return filed u/s -82BB of ITO 1984
2012 2013-2014 43,734,860 52,811,854 52,811,854 (9,076,994) Return filed u/s -82BB of ITO 1984
2013 2014-2015 65,086,678 59,350,764 59,350,764 5,735,914 Return filed u/s -82BB of ITO 1984
2014 2015-2016 7,879,650 19,340,561 - -
Total 201,246,112 201,469,906 182,129,345 11,237,117
NCCB Capital Limited
Directors Report, 2014
Dear Shareholders,
I am pleased to present the Directors Report of the NCCB Capital Ltd. for the year ended on 31.12.2014
together with audited financial statement and auditors report thereon along with the Companys state
in compliance with the Companies Act-1994.
Dear shareholders,
You are aware that due to policy reasons of the licensing authority, the company could not obtain
license from the competent authority as yet and as such failed to start its operational activities. It is
hoped that the legal and procedural hindrance would clear away soon. The authority at the parent
company is trying its best to obtain required license at the earliest.
Due to want of license, the company was compelled to pass another year of its existence without being
able to produce any result. However, a brief description is appended below about the affairs of the
company for ready reference.
Authorized and paid-up-Capital: The Authorized and paid-up-Capital of the Company remained at Tk.
1000 Million and Tk. 250 Million respectively as on 31.12.2014.
Operational Result: The Company due to its inoperative state suffered operational loss as on
31.12.2014 to the tune of Tk. 0.25 Million.
Conclusion:
We hope that it will be possible to obtain required license soon & we can go on to operation to play over
role to the growth of the sector in near future. We take this opportunity to record our thanks and
gratitude to all concerned including registrar of joint stock co. and Bangladesh bank for their
co-operation. Our thanks also go to the members of the Board of Directors of the Company for their
guidance so far.
Thanking you,
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on auditors judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entitys preparation and fair presentation of the financial statements in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entitys internal control. An audit also includes evaluating the appropriateness of accounting policies used
and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the
financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements give a true and fair view of the financial position of the Company as at 31 December
2014 and of its financial performance and its cash flows for the year then ended in accordance with the Bangladesh Financial
Reporting Standards ( BFRS ) and comply with the companies Act 1994, the Securities and Exchange Rules 1987 and other
applicable laws and regulations.
(i) We have obtained all the information and explanations which to the best of our knowledge and belief were neces
sary for the purpose of our audit and made due verification thereof;
(ii) in our opinion, proper books of account as required by law have been kept by the Company, so far as it appeared
from our examination of those books;
(iii) the Companys statement of Financial position and Statement of Comprehensive income dealt with by the report are
in agreement with the books of account; and
(iv) the expenditure incurred were for the purposes of the Companys business.
2014 2013
Notes
Taka Taka
Particulars
Sources of fund
Shareholders' equity
Share capital 3 250,000,000 250,000,000
Retained earnings 4 8,342,114 8,594,632
258,342,114 258,594,632
Long term liabilities 5 - -
Total Sources of fund 258,342,114 258,594,632
Applications of fund
Non-current assets
Preliminary expenses 7 - -
Current assets
Cash and bank balance 8 271,032,940 271,044,320
Advance and prepayments 9 4,957,284 3,724,126
275,990,224 274,768,446
Less: Current liabilities
Payable to NCC Bank Limited 10 12,465,580 10,997,034
Provision for expenses 11 25,750 20,000
Provision for income tax 12 5,156,780 5,156,780
17,648,110 16,173,814
Net current assets 258,342,114 258,594,632
These Financial Statements should be read in conjunction with the annexed notes from 1 to 32.
2014 2013
Notes
Taka Taka
Particulars
Operating income 13 - -
Less: Operating expenses 14 - -
Net Income from operation - -
Other income-interest on FDR 15 - 10,854,216
- 10,854,216
Less: Office & administrative Expenses 16 252,518 2,874,382
Profit/(Loss) before financial expenses (252,518) 7,979,834
These Financial Statements should be read in conjunction with the annexed notes.
Cash in hand - -
Cash at bank:
Current deposit account with NCCBL, Dilkusha branch 271,032,940 271,044,320
( Account No.0028-0210017040)
Fixed deposit account with NCCBL, Dilkusha branch - -
( Account No.0028-0330025993) interest rate @ 12.50%
271,032,940 271,044,320
9 Advances & prepayments
Advance against office rent - -
Interest receivable on FDR - -
Advance income tax paid 2,617,812 1,384,654
Advance income tax deducted at source on interest of FDR 2,339,472 2,339,472
4,957,284 3,724,126
10 Payable to NCC Bank Limited :
Registration fees 819,325 819,325
Documentation fees 126,520 126,520
Trade License fee 13,100 13,100
Income Tax paid for obtaining TIN number 1,000 1,000
Payable against advance for office rent - -
Payable against advance income tax of the company 2,617,812 1,384,654
Office rent 8,098,750 7,889,750
Electricity-office 704,017 687,821
Water & Sewage 85,056 74,864
12,465,580 10,997,034
11 Provision for expenses
Audit Fee 25,750 20,000
25,750 20,000
12 Provision for income tax
Opening balance 5,156,780 2,164,342
Add: Addition during the period - 2,992,438
Closing balance 5,156,780 5,156,780
13 Operating income - -
14 Operating expenses - -
15 Other income-interest on FDR - 10,854,216
16 Office and administrative expenses
Office rent 209,000 2,508,000
Electricity-office 16,196 330,240
Water & Sewage 10,192 31,142
Bank charges 11,380 -
Audit fees 5,750 5,000
Trade subscription - -
Amortization of preliminary expenses - -
252,518 2,874,382
17 Financial expenses - -
18 Reporting currencies :
The figure in the financial statements represent Bangladeshi Taka currency and rounded off to the nearest Taka.
19 Reporting period
These Financial Statements cover for the period from 01 January 2014 to 31 December 2014.
BALANCE SHEET
As at 31 December 2014
2014 2013 2014 2013
Particulars
() () (Tk.) (Tk.)
FIXED ASSETS
CURRENT ASSETS
206
CREDITORS 2,409 27,736 290,046 3,511,655
NET CURRENT LIABILITIES 32,977 (19,667) 3,970,133 (2,490,039)
Total Assets less Current Liabilities 48,536 8,593 5,843,327 1,087,960
Creditors-Amounts falling due after more than one year 61,743 24,913 7,433,365 3,154,234
CAPITAL AND RESERVES
BARISAL
SATKHIRA
01
1985
06
1987
09
1986
02
1993
2001
05
1994
02
2002
02
1995
01
2003
01
1996
04
2004
01
1997
2007
04
07
2008
2006
2010
08
15
2011
2010
Mr. AHM Mustafa Kamal, FCA, MP Minister for Planning is seen receiving a crest
Formal unveiling of new logo
from the Chairman of the Bank Mr. Md. Nurun Newaz Salim
Annual Conference
Donation to the Honorable Prime Ministers fund for T-20 World Cup
Donation to Ahsania Mission, Dhaka
& Lakho Kantha Sonar Bangla
Stipend Distribution Ceremony, 2014 in Dhaka Blanket Handover Ceremony to Bangladesh Bank
Bank's donation handed over to Ambassador of Nepal in Bangladesh in presence Opening Ceremony of Nandail Branch, Mymensingh
of Hon'ble Governor of Bangladesh Bank, for the country's earthquake victims.